Estimating the size of Turkey's informal sector: an expenditure-based approach
AbstractAccurately measuring Turkey's informal sector is important for policymaking. We utilize household income-expenditure surveys to examine this sector's income underreporting. The Pissarides-Weber approach hypothesizes that data would reflect such underreporting as “excess food consumption”. Our results suggest informal sector members spend more than their formal sector counterparts with comparable reported income levels. Using this information, we estimate the average size of the true informal sector to be about 1.25 times the official estimate. The informal sector accounts for around 83% of officially reported disposable income. Therefore, true Turkish disposable income is (25%)*(83%), roughly 21% larger than the officially estimated magnitude.
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Bibliographic InfoArticle provided by Taylor & Francis Journals in its journal Journal of Economic Policy Reform.
Volume (Year): 11 (2008)
Issue (Month): 4 ()
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Other versions of this item:
- Nurhan Davutyan, 2008. "Estimating the size of Turkey's informal sector: an expenditure-based approach," Journal of Economic Policy Reform, Taylor and Francis Journals, vol. 11(4), pages 261-271.
- Nurhan Davutyan, 2008. "Estimating The Size of Turkey’s Informal Sector: An Expenditure Based Approach," Working Papers 403, Economic Research Forum, revised May 2008.
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UniversitÃ© Paris1 PanthÃ©on-Sorbonne (Post-Print and Working Papers)
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