Global Corruption and the Shadow Economy: Spatial Aspects
Posted: 26 Mar 2016 Last revised: 19 Apr 2016
Date Written: 2014
Abstract
Using a large sample of nations, this paper examines the relation between corruption and the shadow economy, focusing especially on geographic spillovers. The results point to complementarity between corruption and the shadow economy. We find evidence of own contagion across nations in both corruption and shadow economy activity, while cross-contagion mostly points to substitution between own shadow economy (corruption) and neighboring corruption (shadow economy). These findings are fairly robust across different estimation techniques and measures of the shadow economy.
Suggested Citation: Suggested Citation
Goel, Rajeev K. and Saunoris, James W., Global Corruption and the Shadow Economy: Spatial Aspects (2014). Public Choice, Vol. 161, No. 1, pp.119-139, 2014, Available at SSRN: https://ssrn.com/abstract=2754305
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