IDEAS home Printed from https://ideas.repec.org/a/alu/journl/v2y2014i16p13.html
   My bibliography  Save this article

Measuring Money Laundering Using ‘The Walkergravity Model‘

Author

Listed:
  • Corina -Maria Ene

    (Hyperion University from Bucharest Romania)

Abstract

Addressing money laundering in terms of measurement possibilities of its dynamicsand size is a relatively recent concern. The hidden nature of this phenomenon (money launderingcan‘t be directly observed) make it impossible to obtain a comprehensive estimate of its size andgrowth rate. This situation has been widely discussed in economic literature, which has exposeda number of illegal economic transactions measurement methods. Unfortunately, many casestudies, econometric variables, or some other techniques used to measure shadow economy aretending to underestimate or overestimate money laundering. Moreover, estimating the size andvolume of financial resources generated by organized crime is an extremely difficult task mainlydue to lack of appropriate data. Therefore, all existing estimates contain considerable errors andthey are only preliminary scientific estimates. Since the official statistics are not able to capturethe dynamics of illicit financial flows, the researchers have developed a number of estimationmethods. These include "hot money" method, World Bank residual method, the model based oninternational market prices, the Walker Gravity model, and many similar. The model presented inthis paper is the gravity model that makes possible to estimate the illicit funds flow from somejurisdictions to others. Developed in 1994 the method is permanently updating. We try to provethat Walker Model estimates are compatible with nowadays findings on money laundering. Onceit knows the money laundering level, one can quantify its economic effect, the impact of moneylaundering prevention rules, and transnational crimes.

Suggested Citation

  • Corina -Maria Ene, 2014. "Measuring Money Laundering Using ‘The Walkergravity Model‘," Annales Universitatis Apulensis Series Oeconomica, Faculty of Sciences, "1 Decembrie 1918" University, Alba Iulia, vol. 2(16), pages 1-13.
  • Handle: RePEc:alu:journl:v:2:y:2014:i:16:p:13
    as

    Download full text from publisher

    File URL: http://oeconomica.uab.ro/upload/lucrari/1620142/13.pdf
    Download Restriction: no

    More about this item

    Keywords

    money laundering; Walker Gravity model; illegal transactions; black market; organized crime;

    JEL classification:

    • K40 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - General
    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law
    • H26 - Public Economics - - Taxation, Subsidies, and Revenue - - - Tax Evasion and Avoidance
    • O17 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:alu:journl:v:2:y:2014:i:16:p:13. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Dan-Constantin Danuletiu). General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.