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Work in the Shadow: Micro and Macro Results

Abstract The main focus of this paper is on the shadow economy labor force in OECD, developing and transition countries. As well as informal employment in the rural and non-rural sector, other measures of informal employment, such as the share of women and men, are also shown. The most influential factors on the shadow economy labor force are tax policies and state regulation, which, if they rise, increase shadow economy activities. Furthermore, the discussion of recent micro studies underlines that economic opportunities, the overall burden of the state (taxes and regulations), the general situation on the labor market, and unemployment are crucial for an understanding of the dynamics of the shadow labor force.