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Shadow Economy Worsens Income distribution

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  • Ioannis Gasteratos
  • Michael Karamalis
  • Andreas Koutoupis

Abstract

Shadow economy has many repercussions affecting most sectors of the economy. Our research question is how shadow economy affects income distribution. The contribution of the present paper is that if is found that shadow economy worsens income distribution. Our sample includes the following countries Austria, Belgium, Cyprus, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Netherlands, Portugal, Spain, Sweden and UK. It becomes evident that, international accounting standards and international standards of auditing should be adopted by EU members to eliminate shadow economy, and thus promote not only economic growth but also political stability. The structure of this paper has as follows. Literature review will be presented in sector1. In sector 2 the econometric model will be analyzed and finally conclusions will be discussed in sector 3.

Suggested Citation

  • Ioannis Gasteratos & Michael Karamalis & Andreas Koutoupis, 2016. "Shadow Economy Worsens Income distribution," International Journal of Economics & Business Administration (IJEBA), International Journal of Economics & Business Administration (IJEBA), vol. 0(3), pages 80-92.
    • Handle: RePEc:ers:ijebaa:v:iv:y:2016:i:2:p:80-92
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    References listed on IDEAS

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    2. repec:ers:journl:v:special_issue:y:2018:i:1:p:387-396 is not listed on IDEAS
    3. Andreev A.S. & Andreeva O.V. & Bondareva G.V. & Osyak V.V., 2018. "Understanding the Underground Economy," European Research Studies Journal, European Research Studies Journal, vol. 0(Special 2), pages 814-822.
    4. Paraskevi Koufopoulou & Colin C. Williams & Athanassios Vozikis & Kyriakos Souliotis & Antonios Samprakos, 2021. "Estimating Shadow Economy Size in Greece 2000 - 2018: A Flexible MIMIC Approach," SPOUDAI Journal of Economics and Business, SPOUDAI Journal of Economics and Business, University of Piraeus, vol. 71(3-4), pages 23-47, July-Dece.
    5. Younas, Zahid Irshad & Qureshi, Atiqa & Al-Faryan, Mamdouh Abdulaziz Saleh, 2022. "Financial inclusion, the shadow economy and economic growth in developing economies," Structural Change and Economic Dynamics, Elsevier, vol. 62(C), pages 613-621.
    6. Sefa Karagoz, 2020. "The Importance of the Informal Economy for Social Policy," Istanbul Journal of Economics-Istanbul Iktisat Dergisi, Istanbul University, Faculty of Economics, vol. 70(2), pages 479-505, December.
    7. Samaranayake, D.I.J. & Dayaratna-Banda, O.G., 2019. "Underemployment and Shadow Economy; Is There a Structural Relationship? A Lab-Experimental Test," MPRA Paper 121429, University Library of Munich, Germany, revised 21 Aug 2019.
    8. repec:ers:journl:v:vi:y:2018:i:2:p:56-67 is not listed on IDEAS
    9. Masca, Simona-Gabriela & Chis, Diana-Maria, 2023. "Distributional implications of informal economy in the EU countries: Accounting for the spread of tax evasion benefits and cultural characteristics," Socio-Economic Planning Sciences, Elsevier, vol. 87(PB).

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