The monetary method to measure the shadow economy: The forgotten problem of the initial conditions

Hildegart Ahumada; Facundo Alvaredo; Alfredo Canavese

doi:10.1016/j.econlet.2008.06.001

Journal articles

The monetary method to measure the shadow economy: The forgotten problem of the initial conditions

Hildegart Ahumada ¹ Facundo Alvaredo ^{2, 3, 4, 5} Alfredo Canavese ^{1, 5}

1 Universidad Torcuato Di Tella

2 CREST - Centre de Recherche en Économie et Statistique

3 PSE - Paris School of Economics

4 PJSE - Paris-Jourdan Sciences Economiques

5 CONICET - Consejo Nacional de Investigaciones Científicas y Técnicas [Buenos Aires]

Abstract : We show that when the money demand function used to estimate the size of the shadow economy includes the lagged dependent variable, the need to assume a known initial condition reappears as it was the case in the early monetary methods.

Keywords : Underground economy Informality Monetary method

Document type :

Journal articles

Domain :

Humanities and Social Sciences / Economics and Finance

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https://hal-pjse.archives-ouvertes.fr/hal-00812857
Contributor : Caroline Bauer <>
Submitted on : Friday, April 12, 2013 - 10:22:00 PM
Last modification on : Thursday, July 1, 2021 - 5:32:49 PM

The monetary method to measure the shadow economy: The forgotten problem of the initial conditions

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The monetary method to measure the shadow economy: The forgotten problem of the initial conditions

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