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On the effects of e-participation on shadow economy: a worldwide empirical analysis

Author

Listed:
  • Sacchi Agnese

    (Department of Economics, Society, Politics, 19044 University of Urbino, Via Saffi 42, 61029 Urbino, Italy)

  • Santolini Raffaella

    (Department of Economics and Social Sciences, Marche Polytechnic University, Piazzale Martelli, 8, 60121 Ancona, Italy)

  • Schneider Friedrich

    (Research Institute of Banking and Finance, Johannes Kepler University of Linz, Altenbergerstrasse 69, A-4040 Linz, Austria)

Abstract

This paper explores the relationship between the e-participation attitude of citizens and the size of the shadow economy, whose consequences could be detrimental to countries’ economic development. We exploit a rich panel dataset for 149 countries characterized by a large digital divide within their public sectors, different levels of both income and democratic institutions at work over years 2003–2015. Using the instrumental variables approach to address potential endogeneity issues, we find that e-participation significantly contributes to reducing the shadow economy. Due to its interactive nature for both businesses and citizens, it positively affects the individuals’ behavior against informal economic activities by creating a more collaborative environment between the government and its stakeholders.

Suggested Citation

  • Sacchi Agnese & Santolini Raffaella & Schneider Friedrich, 2022. "On the effects of e-participation on shadow economy: a worldwide empirical analysis," German Economic Review, De Gruyter, vol. 23(3), pages 463-491, August.
    • Handle: RePEc:bpj:germec:v:23:y:2022:i:3:p:463-491:n:2
    DOI: 10.1515/ger-2021-0076
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    Citations

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    Cited by:

    1. Emmanuel Umoru Haruna & Usman Alhassan, 2022. "Does digitalization limit the proliferation of the shadow economy in African countries? An in‐depth panel analysis," African Development Review, African Development Bank, vol. 34(S1), pages 34-62, July.
    2. Martins, Maria Lurdes, 2023. "Cybersecurity provision and online services access and usage," 32nd European Regional ITS Conference, Madrid 2023: Realising the digital decade in the European Union – Easier said than done? 278001, International Telecommunications Society (ITS).
    3. BRICI Iulia & ACHIM Monica Violeta, 2023. "Does The Digitalization Of Public Services Influence Economic And Financial Crime?," Studies in Business and Economics, Lucian Blaga University of Sibiu, Faculty of Economic Sciences, vol. 18(2), pages 67-85, August.

    More about this item

    Keywords

    shadow economy; citizens’ e-participation; digital government; economic development; democratic institutions;
    All these keywords.

    JEL classification:

    • E26 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Informal Economy; Underground Economy
    • O17 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements
    • O38 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Government Policy
    • O57 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Comparative Studies of Countries

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