INFORMAL SECTOR AND INSTITUTIONS

  • Muhammed Yusuf ÖZER Kadikoy Anatolian High School, Turkey

Abstract

In this paper, I investigate the relationship between informal sector size and various institutional quality variables: government stability, external conflict, internal conflict, corruption control, military influence over politics, religious tensions, ethnic tensions, law-and-order, democratic quality, and bureaucratic accountability. To this end, I use annual cross-country panel data covering 130 countries from 1990 to 2018. Having conducted a correlation analysis, the size of informal economy and institutional quality indicators are inversely linked. The most crucial institutional quality determinants are law-and-order (-0.53), bureaucratic quality (-0.51), military in politics (-0.45), corruption control (-0.42), and internal conflict (-0.35).

References

[1] Elgin, C. 2021. Informal Economy: Measures, Causes, and Consequences. New York: Routledge.
[2] International Labour Organization, Informal Economy, Available at: https://www.ilo.org/global/topics/dw4sd/themes/informal-economy/lang--en/index.htm
[3] Jahan, I., Pavlik, J. B., and Williams, R.B. 2020. Is the devil in the shadow? The effect of institutional quality on income. Review of Development Economics, 24: 1463 – 1483. DOI:https://doi.org/10.1111/rode.12691.
Published
2022-12-31
How to Cite
ÖZER, Muhammed Yusuf. INFORMAL SECTOR AND INSTITUTIONS. Theoretical and Practical Research in the Economic Fields, [S.l.], v. 13, n. 2, p. 180 – 187, dec. 2022. ISSN 2068-7710. Available at: <https://journals.aserspublishing.eu/tpref/article/view/7471>. Date accessed: 08 feb. 2023. doi: https://doi.org/10.14505/tpref.v13.2(26).07.