Key points are not available for this paper at this time.
The latest empirical research indicates a strong increase in the size of the shadow economy in Western Europe, over the period 1970 to 1990. For 11 of the 17 investigated OECD‐countries the size of the shadow economy in 1990 was more than 10% of GNP. Analysis shows that the major causes of the shadow economy are the direct and indirect tax burden, and government regulation.
Friedrich Schneider (Mon,) studied this question.