"The people who run our government are affected by money just like the rest of us. Over the years, many of these officials have worried about meeting mortgage payments, holding off creditors, and avoiding bankruptcy. Others made fortunes by devoting their time to supervising their business...

This paper analyses how tax morale and countries’ institutional quality affect the shadow economy, controlling in a multivariate analysis for a variety of potential factors. The literature strongly emphasizes the quantitative importance of these factors to understand the level and changes of...