Abstract
This paper explores the relationship between the e-participation attitude of citizens and the size of the shadow economy, whose consequences could be detrimental to countries’ economic development. We exploit a rich panel dataset for 149 countries characterized by a large digital divide within their public sectors, different levels of both income and democratic institutions at work over years 2003–2015. Using the instrumental variables approach to address potential endogeneity issues, we find that e-participation significantly contributes to reducing the shadow economy. Due to its interactive nature for both businesses and citizens, it positively affects the individuals’ behavior against informal economic activities by creating a more collaborative environment between the government and its stakeholders.
Funding statement: This research did not receive any specific grant from funding agencies in the public, commercial, or not-for-profit sectors.
Acknowledgment
We are very grateful to the Editor and two anonymous referees for their valuable remarks. We would like to thank Erika Kraemer Mbula and the participants in the 7th International Conference on “The Shadow Economy, Tax Behaviour and Institutions” at the Brunel University of London for their helpful comments. A special thank is due to Matteo Picchio for his useful suggestions.
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Conflict of interest: None.
Correlation matrix, independent variables.
Epart | density | women | GDPcgr | econflow | infl | pop65 | socglob | fiscfree | busfree | rulelaw | judind | UM-H income | dem | |
Epart | 1 | |||||||||||||
density | 0.188 | 1 | ||||||||||||
female | −0.004 | −0.054 | 1 | |||||||||||
GDPcgr | −0.097 | 0.012 | 0.126 | 1 | ||||||||||
econflow | 0.340 | 0.182 | −0.048 | −0.077 | 1 | |||||||||
infl | −0.167 | −0.058 | 0.049 | 0.092 | −0.231 | 1 | ||||||||
pop65 | 0.517 | 0.041 | 0.351 | −0.033 | 0.435 | −0.188 | 1 | |||||||
socglob | 0.579 | 0.177 | −0.075 | −0.144 | 0.603 | −0.301 | 0.761 | 1 | ||||||
fiscfree | −0.167 | 0.102 | −0.321 | 0.094 | −0.125 | 0.114 | −0.375 | −0.197 | 1 | |||||
busfree | 0.532 | 0.209 | 0.020 | −0.121 | 0.505 | −0.224 | 0.574 | 0.693 | −0.139 | 1 | ||||
rulelaw | 0.560 | 0.185 | −0.036 | −0.114 | 0.558 | −0.314 | 0.672 | 0.815 | −0.328 | 0.758 | 1 | |||
judind | 0.424 | −0.030 | 0.210 | −0.086 | 0.387 | −0.257 | 0.597 | 0.578 | −0.430 | 0.573 | 0.772 | 1 | ||
UMH income | 0.467 | 0.106 | −0.119 | −0.168 | 0.545 | −0.164 | 0.576 | 0.758 | −0.088 | 0.590 | 0.655 | 0.454 | 1 | |
dem | 0.301 | −0.085 | 0.293 | −0.020 | 0.224 | −0.157 | 0.492 | 0.378 | −0.243 | 0.343 | 0.472 | 0.671 | 0.309 | 1 |
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Articles in the same Issue
- Frontmatter
- Original Articles
- Immigration and anti-immigrant voting in the 2017 German parliamentary election
- Reference pricing systems on the pharmaceutical market
- Market structure and horizontal growth strategies – A case study of the container shipping industry
- On the effects of e-participation on shadow economy: a worldwide empirical analysis
- Missing growth measurement in Germany
Articles in the same Issue
- Frontmatter
- Original Articles
- Immigration and anti-immigrant voting in the 2017 German parliamentary election
- Reference pricing systems on the pharmaceutical market
- Market structure and horizontal growth strategies – A case study of the container shipping industry
- On the effects of e-participation on shadow economy: a worldwide empirical analysis
- Missing growth measurement in Germany