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The Strange Case of Dr. “Unemployed” and Mr “Hidden” in Italy


  • Gaetano Lisi

    () (University of Cassino)


While the literature is unanimous in considering unemployment and underground employment as strongly connected and interdependent phenomena, the link between existing causality is controversial. This empirical paper aims at clarifying this intricate relationship. Precisely, two key results emerge from the analysis. The first shows that unemployment (positively) influences the underground employment and vice versa. The second demonstrates that the impact of unemployment on underground employment is stronger than the reverse.

Suggested Citation

  • Gaetano Lisi, 2010. "The Strange Case of Dr. “Unemployed” and Mr “Hidden” in Italy," Economics Bulletin, AccessEcon, vol. 30(4), pages 2802-2816.
  • Handle: RePEc:ebl:ecbull:eb-10-00490

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    References listed on IDEAS

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    Cited by:

    1. Gaetano LISI, 2011. "Optimal taxation and monitoring in an economy with matching frictions and underground activities," Eastern Journal of European Studies, Centre for European Studies, Alexandru Ioan Cuza University, vol. 2, pages 5-11, June.

    More about this item


    underground /hidden /informal /shadow employment (economy); unemployment; models with panel data; simultaneous equations models;

    JEL classification:

    • C3 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables


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