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Using Personal Car Register for Measuring Economic Inequality in Countries with a Large Share of Shadow Economy: Evidence for Latvia

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Listed:
  • Vyacheslav Dombrovsky
  • Konstantin A. Kholodilin
  • Boriss Siliverstovs

Abstract

We suggest to use information from the state register of personal cars as an alternative indicator of economic inequality in countries with a large share of shadow economy. We illustrate our approach using the Latvian pool of personal cars. Our main finding is that the extent of household economic inequality in Latvia is much larger than officially assumed. The latest officially available estimate of the Gini coefficient is 0.36 for 2005, which is much lower than 0.55 for 2009 reported in our paper.

Suggested Citation

  • Vyacheslav Dombrovsky & Konstantin A. Kholodilin & Boriss Siliverstovs, 2011. "Using Personal Car Register for Measuring Economic Inequality in Countries with a Large Share of Shadow Economy: Evidence for Latvia," Discussion Papers of DIW Berlin 1153, DIW Berlin, German Institute for Economic Research.
  • Handle: RePEc:diw:diwwpp:dp1153
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    References listed on IDEAS

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    1. McCarthy, Patrick S, 1996. "Market Price and Income Elasticities of New Vehicles Demand," The Review of Economics and Statistics, MIT Press, vol. 78(3), pages 543-547, August.
    2. Friedrich Schneider & Andreas Buehn & Claudio E. Montenegro, 2011. "Shadow Economies All Over the World: New Estimates for 162 Countries from 1999 to 2007," Chapters,in: Handbook on the Shadow Economy, chapter 1 Edward Elgar Publishing.
    3. Bordley, Robert F & McDonald, James B, 1993. "Estimating Aggregate Automotive Income Elasticities from the Population Income-Share Elasticity," Journal of Business & Economic Statistics, American Statistical Association, vol. 11(2), pages 209-214, April.
    4. Kholodilin, Konstantin A. & Siliverstovs, Boriss, 2012. "Measuring regional inequality by internet car price advertisements: Evidence for Germany," Economics Letters, Elsevier, vol. 116(3), pages 414-417.
    5. Thorbecke, Erik & Charumilind, Chutatong, 2002. "Economic Inequality and Its Socioeconomic Impact," World Development, Elsevier, vol. 30(9), pages 1477-1495, September.
    6. Hess, Alan C, 1977. "A Comparison of Automobile Demand Equations," Econometrica, Econometric Society, vol. 45(3), pages 683-701, April.
    7. Schneider, Friedrich G., 2007. "Shadow Economies and Corruption All Over the World: New Estimates for 145 Countries," Economics - The Open-Access, Open-Assessment E-Journal, Kiel Institute for the World Economy (IfW), vol. 1, pages 1-66.
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    Cited by:

    1. Braguinsky, Serguey & Mityakov, Sergey, 2015. "Foreign corporations and the culture of transparency: Evidence from Russian administrative data," Journal of Financial Economics, Elsevier, vol. 117(1), pages 139-164.

    More about this item

    Keywords

    Economic inequality; cars; social signaling; Gini index; Latvia;

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • E26 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Informal Economy; Underground Economy
    • Z13 - Other Special Topics - - Cultural Economics - - - Economic Sociology; Economic Anthropology; Language; Social and Economic Stratification

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