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Internet usage and the shadow economy: Evidence from panel data

  • Elgin, Ceyhun

The enormous spread of the internet in the last 20 years has been having various economic consequences. In this paper I ask whether the spread of the internet aided or abetted the shadow economy. To this end, using a panel data of 152 countries over 9 years from 1999 to 2007, I examine the empirical relationship between the degree of internet usage and the size of the shadow economy. Panel and cross-section estimation results indicate that the association between internet usage and shadow economy size strongly interacts with GDP per-capita. I also suggest and then empirically test an economic mechanism to account for this observation.

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Article provided by Elsevier in its journal Economic Systems.

Volume (Year): 37 (2013)
Issue (Month): 1 ()
Pages: 111-121

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Handle: RePEc:eee:ecosys:v:37:y:2013:i:1:p:111-121
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  19. Naudé, Wim & Saayman, Andrea, 2005. "Determinants of tourist arrivals in Africa: a panel data regression analysis," MPRA Paper 16479, University Library of Munich, Germany.
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