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Involvement in the “Shadow Economy†: Imaginary Psychological Readiness and Real Participation

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  • Emilia Chengelova

    (Institute of Philosophy and Sociology at BAS, Sofia, Bulgaria)

Abstract

The article presents unpublished, new empirical data on the psychological readiness of Bulgarians to become part of shadowy economic practices, as well as estimates of actual participation in such practices. The data are derived from a national representative survey of the population conducted in 2021, but have not lost their relevance, since the economic behavior of individuals is characterized by a high degree of constancy. The research shows a relatively high psychological readiness for inclusion in the “shadow economy†, and two violations of the labor and insurance legislation are most often encountered in the Bulgarian economy – work without a contract and work with a fictitious contract, in which the person is insured for a smaller amount, but he is paid additional tax-free cash – “money in a bag†. About one-third of Bulgarians are defined as economic deviants (violating laws and regulations), while the other two-thirds adhere to economic conformism (follow laws and regulations) in their behavior. In this context, the question of mastering the “shadow economy†remains open, and its relevance not only does not diminish, it also necessitates the activation of the efforts of the entire society.

Suggested Citation

  • Emilia Chengelova, 2023. "Involvement in the “Shadow Economy†: Imaginary Psychological Readiness and Real Participation," Ikonomiceski i Sotsialni Alternativi, University of National and World Economy, Sofia, Bulgaria, issue 4, pages 124-142, December.
  • Handle: RePEc:nwe:iisabg:y:2023:i:4:p:124-142
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    More about this item

    Keywords

    shadow economy; shadowy economic practices; labor relations; public opinion;
    All these keywords.

    JEL classification:

    • E26 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Informal Economy; Underground Economy
    • A14 - General Economics and Teaching - - General Economics - - - Sociology of Economics
    • C26 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Instrumental Variables (IV) Estimation
    • E71 - Macroeconomics and Monetary Economics - - Macro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on the Macro Economy

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