Istituzioni, Diseguaglianza ed Economia Sommersa: quale relazione?

In this paper, we investigate on the determinants of the size of shadow economy (SE) in Latin America. While the analysis of economic causes of SE has been extensively studied in literature, here we offer a wider prospective. In addition to overall economic development, unemployment rate, and marginal tax rate, we examine the relationships of SE with institutional indicators and income inequality. We find empirical evidence to state that the institutional background is essential to explain the size of SE; income inequality is weakly correlated with SE; the level of GDP is correlated positively with SE as percentage of official economy.