Global corruption and the shadow economy: spatial aspects

Public Choice, 2014, vol. 161, issue 1, 119-139

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. Copyright Springer Science+Business Media New York 2014

Keywords: Corruption; Shadow economy; Spatial lag; Contagion; K49; O17; C21 (search for similar items in EconPapers)
Date: 2014
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Citations: View citations in EconPapers (60)

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Persistent link: https://EconPapers.repec.org/RePEc:kap:pubcho:v:161:y:2014:i:1:p:119-139

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DOI: 10.1007/s11127-013-0135-1

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