The comparison of the shadow economy in Turkey and european countries

Abstract

As informal activities are considered as a crime, that kind of activities are being carried out secretly and their detection is difficult in most cases. Along with difficulties in determining the size of informal economy exactly, recently developed models and opportunities to reach reliable data enable making realistic estimations in regard to shadow economy. This study benefits from 11 different studies estimating informality in European countries and Turkey by using physical input, currency demand, DYMIMIC, and MIMIC methods. Common conclusion acquired from these studies is that informality rate in Turkey is higher than EU15 countries and EU13 countries -except for Hungary, Cyprus, Latvia, Croatia and Bulgaria. In addition to the comparison of these data, the reasons of the emergence of informal economy, measuring methods, and policy proposals in order to hamper informality in Turkey are also discussed. © 2016 by IGI Global. All rights reserved.