The Shadow Economy, Corruption And Governance

‘. . . the book provides interesting insights in the correlation and links between institutions, shadow economy and corruption and is worth reading. . . the combination of theoretical and empirical elements makes reading the book worthwhile. In a time, when shadow economy and corruption are main topics on the political as well as on the economic agenda, several aspects highlighted in this book should be discussed by academics and politicians.’
– Dominik H. Enste, Journal of Economics and Statistics

‘This is an outstanding collection of articles on the nexus between the shadow economy and institutional quality. Combining theory with rigorous econometrics, the collection is comprehensive and insightful, making it a work that the students of institutions and development cannot ignore.’
– Axel Dreher, KOF Swiss Economic Institute, ETH Zurich, Switzerland

This book contributes to the current debates on the shadow economy and related issues of tax evasion and corruption. The approach taken here is one that will develop a better understanding of these related issues, which are increasingly seen as impediments to country competitiveness and economic growth.

Economists and policymakers are increasingly focused on how the shadow economy operates. The contributors discuss how effective corporate governance may help to reduce both the occurrence and effects of illegal activities. The book begins by considering institutional governance and how issues such as economic growth and development can be better understood by gaining a deeper understanding of the decision-making process. The importance of collective persuasion and collective decision-making in an institutional context is illustrated. The remainder of the work details a series of empirical studies outlining the role of governance and institutional capacity in assessing economic performance, the role of political competition in reducing corruption and measures of, and influences on, corruption in different countries around the world.

Institutions such as the WTO, World Bank and the IMF will find much to engage them in this book as will policy makers in government and research policy agencies. It will also hold great appeal to academics (postgraduate and above) in the fields of political economy, economic development and international economics.

Contents:

Preface

PART I: OVERVIEW
1. Governance and Illegal Activities: A Survey of Recent Developments and Issues
Michael Pickhardt and Edward Shinnick

PART II: KEY ISSUES OF INSTITUTIONAL GOVERNANCE
2. The Political Economy of Governance and Development: Towards a New Worldview
Ismail Adams

3. A Dynamic Theory of Collective Persuasion
Athanassios Pitsoulis

4. On the Optimal Sanction Structure When Individuals are Imperfectly Informed about the Probability of Apprehension
Tim Friehe

PART III: EMPIRICAL STUDIES ON INSTITUTIONS, GOVERNANCE CORRUPTION AND THE SHADOW ECONOMY
5. Institutional Capacity and the Celtic Tiger Economy: Ireland in Comparative Perspective
Frank Barry

6. Reducing Petty Corruption: What Role for a More Competitive Political System?
John K. Wilson

7. Shadow Economies and Corruption all over the World: What do we Really Know?
Friedrich Schneider

8. Determinants of Shadow Economy in Tunisia and Algeria: A Firm-Level Analysis
Clara Delavallade

9. “It’s a Lot, But Let It Stay”: How Tax Evasion is Perceived Across Italy
Carlo Fiorio and Alberto Zanardi

10. Why Do Individuals Evade Payroll and Income Taxation in Estonia?
Kenneth A. Kriz, Jaanika Meriküll, Alari Paulus, Karsten Staehr

Index