A NEW ESTIMATION OF THE SIZE OF INFORMAL ECONOMY USING MONETARY AND FULL EXPENDITURES IN A COMPLETE DEMAND SYSTEM
Journal article: We use the demand system approach to estimate the size of informal economy in Turkey following the methodology based on the analysis of the individual consumption behaviour proposed by Pissarides, Weber [1989], Lyssiotou et al. [2004] and Fortin et al. [2009]. We extend this method by taking into account both the monetary expenditures and time spent on domestic activities. The necessary information of money and time inputs in consumption on the household’s level is obtained by a statistical match of the Turkish Family Budget and Time Use surveys [2006]. As expected, the estimated model size of the informal economy in Turkey using the full (time plus money) expenditure is higher than those obtained by only monetary expenditure approach (in average 40.6 % and 33.5 % of gdp for self employers and 20.7% and 14.1% of gdp for wage-earners respectively) and also higher than that obtained by more conventional macroeconomic methods (35.1%).
Author(s)
Armagan Tuna Aktuna-Gunes, Christophe Starzec, François Gardes
Journal
- Revue Economique
Collection
- Avancées de la Recherche en Microéconomie Appliquée à l’occasion des XXX JMA (Nice 2013)
Date of publication
- 2014
Keywords JEL
Keywords
- The size of the informal economy
- Demand system
- Manetary and time expenditure
- Domestic production
Pages
- 567
URL of the HAL notice
Version
- 1
Volume
- 65