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Informal economy in Bolivia: analysis, evaluation and quantification based on cash monetary effective demand approach (period 1994-2014)

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  • Danilo Velasco Valdez

    (Doctorado en Economía y Administración de Empresas, Universidad Privada Boliviana)

Abstract

The informal economy represents a set of production and marketing activities that are underestimated by national accounts because they are developed under uncontrollable circumstances or are openly illegal. In this context, it turns to be an opportunity to develop an approach that allows its quantification, using a Cash Demand Model, based on time series for the last twenty years. This paper estimates the size of the informal economy in our country around 54% and 63%, with a decreasing trend for the last decade, which happens to coincide with the last government change. As a phenomenon it has an important economic significance, and deserves a proper analysis and monitoring.

Suggested Citation

  • Danilo Velasco Valdez, 2015. "Informal economy in Bolivia: analysis, evaluation and quantification based on cash monetary effective demand approach (period 1994-2014)," Investigación & Desarrollo, Universidad Privada Boliviana, vol. 1(1), pages 74-87.
    • Handle: RePEc:iad:wpaper:0515
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    References listed on IDEAS

    as
    1. Friedrich Schneider & Christopher Bajada, 2003. "The Size and Development of the Shadow Economies in the Asia-Pacific," Economics working papers 2003-01, Department of Economics, Johannes Kepler University Linz, Austria.
    2. Gasparini Leonardo & Leonardo Tornaroli, 2009. "Labor Informality in Latin America and the Caribbean: Patterns and Trends from Household Survey Microdata," Revista Desarrollo y Sociedad, Universidad de los Andes,Facultad de Economía, CEDE, September.
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    More about this item

    Keywords

    Informal eocnomy; money demand; monetary approach.;
    All these keywords.

    JEL classification:

    • C10 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - General
    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General

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