Perceived Manifestations of Shadow Economy in Bulgaria, Greece, Romania and Croatia According to a Eurobarometer Survey

Shadow economy is a persistent and characteristic phenomenon of the economy of Eastern Europe. The article aims to study the shadow sector in several countries – Bulgaria, Greece, Romania and Croatia, presenting unpublished data on its perceived manifestations from the point of view of demand and supply. The data used is from a Eurobarometer survey conducted in 2019. The information provided is up-to-date and relevant to the study of shadow economy, due to the relatively constant behavior of economic agents and the lack of analogous recent survey that examines informal activity in such details, allowing comparative analysis with other European countries. The declared behavior of the respondents is examined and statistical tests are employed to indicate statistically significant differences between the mean values of the four countries regarding the performed paid undeclared activities and the purchase of goods from the shadow sector. The research specifies the sectors most affected by undeclared activities – in Bulgaria this is construction. The reasons for participation in the shadow economy from the supply and demand side are analyzed. The results reveal the pragmatism of Bulgarian respondents in comparison to the motivation of respondents in the other three countries. The most common paid undeclared activities are also indicated, as well as the most frequently purchased goods and services from the shadow sector. The material builds on the current knowledge on the subject and provides a starting point for the refinement of policies to combat shadow economy.