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Date: April 30, 2024 Tue
Time: 2:08 am
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Results for shadow economy
7 results foundAuthor: Kar, Saibal Title: Corruption, Shadow Economy and Income Inequality: Evidence from Asia Summary: A number of recent studies for Latin America show that as the size of the informal economy grows, corruption is less harmful to inequality. We investigate if this relationship is equally compelling for developing countries in Asia where corruption, inequality and shadow economies are considerably large. We use Panel Least Square and Fixed Effects Models for Asia to find that both ‘Corruption Perception Index’ and ‘ICRG’ index are sensitive to a number of important macroeconomic variables. We find that in the absence of the shadow economy, corruption increases inequality. However, with larger shadow economies in South Asia, the income inequality tends to fall. Details: Bonn, Germany: Institute for the Study of Labor (IZA), 2012. 31p. Source: Internet Resource: IZA Discussion Paper No. 7106: Accessed January 29, 2013 at: http://ftp.iza.org/dp7106.pdf Year: 2012 Country: Asia URL: http://ftp.iza.org/dp7106.pdf Shelf Number: 127415 Keywords: Corruption (South Asia)InequalityShadow Economy |
Author: Ardizzi, Guerino Title: Money Laundering as a Financial Sector Crime - A New Approach to Measurement, with an Application to Italy Summary: Anti–money laundering regulations have been centred on the “Know-Your-Customer” rule so far, overlooking the fact that criminal proceedings that need to be laundered are usually represented by cash. This is the first study which tries to provide an answer to the question of how much of cash deposited via an official financial institution can be traced back to criminal activities. The paper develops a new approach to measure money laundering and then proposes an application to Italy, a country where cash is still widely used in transactions and criminal activities generate significant proceeds. In particular, we define a model of cash in-flows on current accounts and proxy money laundering with two indicators for the diffusion of criminal activities related to both illegal trafficking and extortion, controlling also for structural (legal) motivations to deposit cash, as well as the need to conceal proceeds from tax evasion. Using a panel of 91 Italian provinces observed over the period 2005-2008, we find that the average total size of money laundering is sizable, around 7% of GDP, 3/4 of which is due to illegal trafficking, while 1/4 is attributable to extortions. Furthermore, the incidence of “dirty money” coming from illegal trafficking is higher in the Centre-North than in the South, while the inverse is true for money laundering coming from extortions. Details: Munich, Germany: Center for Economic Studies (CES), the Ifo Institute and the CESifo GmbH (Munich Society for the Promotion of Economic Research), 2013. 30p. Source: Internet Resource: CESifo Working Paper No. 4127: Accessed February 27, 2013 at: http://www.cesifo-group.de/ifoHome/publications/working-papers/CESifoWP/CESifoWPdetails?wp_id=19076139 Year: 2013 Country: Italy URL: http://www.cesifo-group.de/ifoHome/publications/working-papers/CESifoWP/CESifoWPdetails?wp_id=19076139 Shelf Number: 127738 Keywords: ExtortionFinancial CrimesIllegal TraffickingMoney Laundering (Italy)Shadow EconomyWhite Collar Crime |
Author: Snowdon, Christopher Title: Drinking in the Shadow Economy Summary: Executive summary: • One in ten bottles or cans of beer sold in the UK have not had duty paid on them and there are growing reports of counterfeit spirits being sold by licit and illicit retailers. HMRC seized almost ten million litres of non-duty paid alcohol in 2010/11, a rise of 30 per cent in two years. The UK loses more revenue from the cross-border movement of alcohol than any other EU state. The aim of this paper is to identify the factors that encourage the production, distribution and purchasing of alcohol in the shadow economy. • Unrecorded alcohol encompasses smuggled alcohol, commercially manufactured counterfeit alcohol, domestic brewing and distilling, surrogate alcohol, alcohol fraud and cross-border shopping. Failing to deal with alcohol’s shadow economy threatens not only the public finances, but also public health and public order. Counterfeit spirits and surrogate alcohol frequently contain dangerous levels of methanol, isopropanol and other chemicals which cause toxic hepatitis, blindness and death. Alcohol smuggling and counterfeiting is linked to other illegal activities, including drug smuggling, prostitution, violence, money-laundering and terrorism. • Factors which lead to shadow economic activity include high taxes and social security payments, low tax morale, complex tax systems, low Gross Domestic Product, weak institutions and corruption. Evidence shows that the illicit alcohol market is also closely associated with high taxes, corruption and poverty. The affordability of alcohol appears to be the key determinant behind the supply and demand for smuggled and counterfeit alcohol. Affordability is low in some countries due to low incomes (e.g. Eastern Europe) and in others because of high alcohol duty (e.g. Scandinavia). The price of alcohol in neighbouring markets also influences rates of unofficial consumption. • Demand for alcohol is relatively inelastic and drinkers have a series of options available to them when real prices increase. They can do as the government hopes and drink less, but they can also do any of the following: (1) make savings elsewhere in the household budget, (2) switch from the on-trade to the off-trade, (3) downshift to cheaper drinks, (4) shop abroad, (5) brew or distil their own alcohol, (6) buy counterfeit or smuggled alcohol, and finally (7) buy surrogate alcohol (e.g. methanol, antifreeze, aftershave). The extent to which consumption patterns change depends on personal income and the affordability of alcohol. • Our analysis indicates that the affordability of alcohol does not have a strong effect on how much alcohol is consumed. Once unrecorded alcohol is included in the estimates, it can be seen that countries with the least affordable alcohol have the same per capita alcohol consumption rates as those with the most affordable alcohol. • Alcohol duty provides significant income to European governments, but maximising these revenues carries significant risks in terms of health, crime and secondary poverty. Lessons can be learnt from countries which have low rates of unrecorded alcohol. We conclude that economic prosperity, moderate taxation and minimal corruption are essential for a country to minimise the size the alcohol black market. Without these preconditions, efforts to tackle the illicit alcohol supply through education, deterrence and enforcement are unlikely to succeed. Details: London: Institute of Economic Affairs, 2012. 27p. Source: Internet Resource: IEA Discussion paper no. 43: Accessed June 5, 2013 at: http://www.iea.org.uk/publications/research/drinking-in-the-shadow-economy Year: 2012 Country: United Kingdom URL: http://www.iea.org.uk/publications/research/drinking-in-the-shadow-economy Shelf Number: 128964 Keywords: Alcohol IndustryBusiness CrimesCommercial CrimesFraudIllegal Alcohol SalesShadow EconomyTax Evasion |
Author: Enste, Dominik H. Title: The shadow economy in industrial countries: Reducing the size of the shadow economy requires reducing its attractiveness while improving official institutions Summary: The shadow (underground) economy plays a major role in many countries. People evade taxes and regulations by working in the shadow economy or by employing people illegally. On the one hand, this unregulated economic activity can result in reduced tax revenue and public goods and services, lower tax morale and less tax compliance, higher control costs, and lower economic growth rates. But on the other hand, the shadow economy can be a powerful force for advancing institutional change and can boost the overall production of goods and services in the economy. The shadow economy has implications that extend beyond the economy to the political order. The shadow economy should not be seen as solely an economic problem, to be resolved by attacking the symptoms through higher fines and tougher controls. A country-specific analysis of causes and consequences is necessary in order to develop policy measures appropriate to the country's level of development. Policymakers should view illicit work as a signal of the need to decrease the attractiveness of the shadow economy through better regulation, a fair and transparent tax system, and more efficient institutions (good governance). Organized crime and illegal employment should nevertheless be fought through stricter controls and enforcement. Details: Bonn: IZA World of Labor, 2015. 10p. Source: Internet Resource: Accessed April 24, 2015 at: http://wol.iza.org/articles/shadow-economy-in-industrial-countries-1.pdf Year: 2015 Country: International URL: http://wol.iza.org/articles/shadow-economy-in-industrial-countries-1.pdf Shelf Number: 135386 Keywords: Financial CrimeIllicit WorkOrganized CrimeShadow EconomyTax EvasionUnderground Economy |
Author: Schneider, Friedrich Title: Restricting or Abolishing Cash: An Effective Instrument for Fighting the Shadow Economy, Crime and Terrorism? Summary: This paper has four goals: First, the use of cash as a possible driving factor of the shadow economy is investigated. Second, the use of cash in crime, here especially in corruption, is also econometrically investigated. The influence is somewhat larger than on the shadow economy, but it is certainly not a decisive factor for bribery activities. Some figures about organized crime are also shown; the importance of cash is diminishing. Third, some remarks about terrorism are made and here a cash limit doesn't prevent terrorism. Fourth, some remarks are made about the restriction or abolishment of cash on civil liberties, with the result that this will extremely limit them. The conclusion of this paper is that cash has a minor influence on the shadow economy, crime and terrorism, but potentially a major influence on civil liberties. Details: Paper presented at International Cash Conference 2017 - War on Cash: Is there a Future for Cash? 25 - 27 April 2017, Island of Mainau, Germany. 39p. Source: Internet Resource: Accessed September 13, 2017 at: https://www.econstor.eu/bitstream/10419/162914/1/Schneider.pdf Year: 2017 Country: International URL: https://www.econstor.eu/bitstream/10419/162914/1/Schneider.pdf Shelf Number: 147226 Keywords: BriberyCivil LibertiesCorruptionFinancial CrimesMoney LaunderingOrganized CrimeProceeds of CrimeShadow EconomyTerrorist Financing |
Author: Organization for Economic Co-operation and Development (OECD) Title: Governance Frameworks to Counter Illicit Trade Summary: This report examines governance frameworks to counter illicit trade. It looks at the adequacy and effectiveness of sanctions and penalties applicable, the steps parties engaged in illicit trade take to lower the risk of detection - for example through small shipments - and the use of free trade zones as hubs for managing trade in illicit products. It also identifies gaps in enforcement that may need to be addressed. The report provides an overview of selected enforcement issues in BRICS economies (Brazil, China, India, the Russian Federation and South Africa). Details: Paris: OECD Publishing, 2018. 245p. Source: Internet Resource: Accessed March 30, 2019 at: https://www.oecd-ilibrary.org/docserver/9789264291652-en.pdf?expires=1553955039&id=id&accname=oid006203&checksum=8E25339CE1316247565CB35A3E26CDD3 Year: 2018 Country: International URL: http://www.oecd.org/gov/governance-frameworks-to-counter-illicit-trade-9789264291652-en.htm Shelf Number: 155234 Keywords: Counterfeit Products Counterfeiting Governance Frameworks Illicit Products Illicit Trade Law Enforcement Shadow Economy |
Author: Organisation for Economic Co-Operation and Development (OECD) Title: Trends in Trade in Counterfeit and Pirated Goods Summary: This study examines the value, scope and trends of trade in counterfeit and pirated goods. First, it presents the overall scale of this trade and discusses which parts of the economy are particularly at risk. Next, it looks at the main economies of origin of fakes in global trade. Finally, it analyses recent trends in terms of changing modes of shipment and the evolution of trade flows. Details: Paris: OECD Publishing, 2019. 88p. Source: Internet Resource: Accessed March 30, 2019 at: http://www.oecd.org/governance/risk/trends-in-trade-in-counterfeit-and-pirated-goods-g2g9f533-en.htm Year: 2019 Country: International URL: https://www.oecd-ilibrary.org/docserver/g2g9f533-en.pdf?expires=1553956818&id=id&accname=oid006203&checksum=A5C347CB85CAB4323C65722DF035DF9B Shelf Number: 155240 Keywords: Counterfeit Goods Counterfeit Products Fake Goods Illicit Trade Pirated Goods Shadow Economy |