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Shadow Economy - The Impact of Regulation in OECD-countries
Dominik H. Enste 한국국제경제학회 2010 International Economic Journal Vol.24 No.4
A comprehensive regulation index covering five major fields (labour, product and capital market; education/innovation and the quality of institutions) has been used to analyse the relationship between the density of regulations and the size of shadow economies. The empirical results from 25 OECD countries for the time period 1995-2005 show that - apart from tax burden and tax morale - the main causes are labour and product market regulations, overall regulations and poor quality of official public institutions and administration. An overview of relevant findings on the impact of regulation on irregular activities complements these findings.