EIRP Proceedings, Vol 4 (2009)

Analysis of Correlations between Economic Growth (Rate of Real GDP) and the Underground Economy

Silviu Pripoaie, Rodica Pripoaie

Abstract


Analysis of performance of any economy involves the measurement and correlation of three basic elements: the rate of economic growth, the rate of inflation and unemployment rate. When the rate of growth (rate of real GDP) is high, the production of goods and services is growing and therefore increasing the number of jobs, decrease unemployment and raise living standards. If the economy is in recession phase, increasing fiscal pressure to ensure the necessary budgetary funds triggers complex economic mechanisms. Rules more strictly is that those who are not able to operate in the normal economy to slide towards the underground economy, and this not because he wants to tax evasion, but because they simply can not cope with new regulations. It is widely accepted in economic theory and
practice the idea that reliability scale macroeconomic indicators of a country is affected by size of underground economy and the various tests made so far on this subject, focusing either on the social aspect or the economic or moral, or emphasizes the illegal or the edge of legality. This has led to various
studies in this area do not provide comparable data or provide data to the contrary. Worldwide were put in place, however, some calculation methods provided that applied the same country and same period, the results are rarely consistent, sometimes even in fundamentally different.

References



Full Text: PDF

Refbacks

  • There are currently no refbacks.
Creative Commons License
This work is licensed under a Creative Commons Attribution 4.0 International License.