The Hidden Economy and the Tax-Gap in New Zealand: A Latent Variable Analysis
AbstractThis paper develops a structural, latent variable, model for the hidden economy in New Zealand, and a separate currency-demand model. The latent variable model is used to generate an historical time-series index of hidden economic activity, which is calibrated via the information from the currency-demand model. The hidden economy varies between 6.8% and 11.3% of measured GDP. This, in turn, implies that the tax-gap is of the order of 6.4% to 10.2% of total tax liability in that country.
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Bibliographic InfoPaper provided by Department of Economics, University of Victoria in its series Econometrics Working Papers with number 9807.
Length: 40 pages
Date of creation: 03 Jun 1998
Date of revision:
Note: ISSN 1485-6441. This paper was also released as UVic Discussion Paper 97-08 in April 1997, and a longer preliminary version was released as N.Z. Inland Revenue Department Working Paper 5a, November/December 1996. The final version of this paper is now available as vicewp:9905.
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Postal: PO Box 1700, STN CSC, Victoria, BC, Canada, V8W 2Y2
Web page: http://web.uvic.ca/econ
More information through EDIRC
Hidden Economy; Underground Economy; Tax Avoidance; Tax Evasion; Latent Variables; Structural Modelling;
Find related papers by JEL classification:
- C12 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Hypothesis Testing: General
- C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models
This paper has been announced in the following NEP Reports:
- NEP-ALL-1998-10-19 (All new papers)
- NEP-EEC-1998-10-19 (European Economics)
- NEP-PBE-1998-10-19 (Public Economics)
- NEP-PUB-1998-08-31 (Public Finance)
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- David E.A. Giles, 1998.
"The Underground Economy: Minimizing the Size of Government,"
Department Discussion Papers
9801, Department of Economics, University of Victoria.
- David E.A. Giles, 1998. "The Underground Economy: Minimizing the Size of Government," Econometrics Working Papers 9801, Department of Economics, University of Victoria.
- David E. A. Giles, 1998. "The Underground Economy: Minimizing the Size of Government," Econometrics Working Papers 9808, Department of Economics, University of Victoria.
- Tedds, Lindsay, 2005. "The Underground Economy in Canada," MPRA Paper 4229, University Library of Munich, Germany.
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