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The Hare and the Tortoise. How Older Generations Are Replaced By Young One on the Labour Market: Signals and Insights from the Relationship between Shadow Economy and Active Ageing

Author

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  • Adriana AnaMaria DAVIDESCU

    (Bucharest University of Economic Studies, National Scientific Research Institute for Labour and Social Protection, Romania)

  • Catalin Corneliu GHINARARU

    (National Scientific Research Institute for Labour and Social Protection, Romania)

Abstract

The paper aims to analyze the relationship between the size of Romanian shadow economy expressed as % of official GDP and active ageing in order to see if the shadow economy represents a social buffer for active ageing phenomena using Granger causality analysis. The size of Romanian shadow economy is estimated previously using a revised version of the currency demand approach based on autoregressive distributed lag (ARDL) approach to cointegration analysis. Using Granger causality tests, we examine the relationship between employment rate for older people and the size of Romanian shadow economy covering the period between 2000 and 2010. The empirical results revealed the existence of a long-run unidirectional causality that runs shadow economy to employment rate for elderly and do not support the existence of any short-run relationship between employment rate for older people and shadow economy.

Suggested Citation

  • Adriana AnaMaria DAVIDESCU & Catalin Corneliu GHINARARU, 2015. "The Hare and the Tortoise. How Older Generations Are Replaced By Young One on the Labour Market: Signals and Insights from the Relationship between Shadow Economy and Active Ageing," Economia. Seria Management, Faculty of Management, Academy of Economic Studies, Bucharest, Romania, vol. 18(1), pages 163-171, June.
    • Handle: RePEc:rom:econmn:v:18:y:2015:i:1:p:163-171
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    References listed on IDEAS

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    1. Clive W.J. Granger, 2004. "Time Series Analysis, Cointegration, and Applications," American Economic Review, American Economic Association, vol. 94(3), pages 421-425, June.
    2. Pantula, Sastry G., 1989. "Testing for Unit Roots in Time Series Data," Econometric Theory, Cambridge University Press, vol. 5(2), pages 256-271, August.
    3. Vasile Alecsandru STRAT, 2014. "The Relationship Between Foreign Direct Investment And The Higher Education System In Romania," Journal of Social and Economic Statistics, Bucharest University of Economic Studies, vol. 3(1), pages 10-24, JULY.
    4. Iustina Boitan, 2014. "Concentration of Labor Market Risks: A European Union Cross-Country Perspective," Journal of Economic Issues, Taylor & Francis Journals, vol. 48(1), pages 197-228.
    5. Granger, C W J, 1969. "Investigating Causal Relations by Econometric Models and Cross-Spectral Methods," Econometrica, Econometric Society, vol. 37(3), pages 424-438, July.
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    More about this item

    Keywords

    shadow economy; currency demand approach; active ageing; Granger causality; Romania.;
    All these keywords.

    JEL classification:

    • C51 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Model Construction and Estimation
    • E26 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Informal Economy; Underground Economy
    • H20 - Public Economics - - Taxation, Subsidies, and Revenue - - - General
    • H50 - Public Economics - - National Government Expenditures and Related Policies - - - General
    • O17 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements

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