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Shadow economy and tax revenue in Africa

Author

Listed:
  • Oasis Kodila-Tedika

    (University of Kinshasa)

  • Mihai Mutascu

    (LEO (Laboratoire d''Economie d''Orléans) - UMR7322, and West University of Timisoara)

Abstract

The paper explores the effects of shadow economy on tax revenues, in the case of several African countries, based on a panel-model approach. The dataset covers the period 1999-2007. The main results reveal that the change in shadow economy has a significant and negative impact on change in tax revenues. In other word, when the shadow economy tends to extend, the level of tax revenues decreases. These outputs show that the African governments, in order to maximise the collected tax revenues, should better “control” the shadow economy phenomenon.

Suggested Citation

  • Oasis Kodila-Tedika & Mihai Mutascu, 2014. "Shadow economy and tax revenue in Africa," Economics Bulletin, AccessEcon, vol. 34(1), pages 469-479.
    • Handle: RePEc:ebl:ecbull:eb-13-00777
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Kodila-Tedika, Oasis & Mutascu, Mihai, 2014. "Tax Revenues and Intelligence: A Cross-Sectional Evidence," MPRA Paper 57581, University Library of Munich, Germany.
    2. Joseph Keneck-Massil & Alphonse Noah, 2019. "Shadow economy and educational systems in Africa," Economics Bulletin, AccessEcon, vol. 39(2), pages 1467-1478.
    3. Omodero Cordelia Onyinyechi, 2019. "The Consequences of Shadow Economy and Corruption on Tax Revenue Performance in Nigeria," Studia Universitatis „Vasile Goldis” Arad – Economics Series, Sciendo, vol. 29(3), pages 64-79, September.
    4. Mutascu Mihai & Hegerty Scott W., 2022. "The role of refugees in the underground economy of the European Union," IZA Journal of Development and Migration, Sciendo & Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 13(1), pages 1-19, January.
    5. Friedrich Schneider & Mangirdas Morkunas & Erika Quendler, 2021. "Measuring the Immeasurable: The Evolution of the Size of Informal Economy in the Agricultural Sector in the EU-15 up to 2019," CESifo Working Paper Series 8937, CESifo.
    6. Cordelia Onyinyechi Omodero, 2020. "Taxation Income, Graft and Informal Sector Operations in Nigeria in Relation to Other African Countries," International Journal of Financial Research, International Journal of Financial Research, Sciedu Press, vol. 11(2), pages 163-172, April.
    7. Cong Minh Huynh & Vu Hong Thai Nguyen & Hoang Bao Nguyen & Phuc Canh Nguyen, 2020. "One-way effect or multiple-way causality: foreign direct investment, institutional quality and shadow economy?," International Economics and Economic Policy, Springer, vol. 17(1), pages 219-239, February.

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    More about this item

    Keywords

    Shadow economy; Tax revenues; Effects; Implications; Africa;
    All these keywords.

    JEL classification:

    • H0 - Public Economics - - General
    • C1 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General

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