The devil is in the shadow : do institutions affect income and productivity or only official income and official productivity ?

@inproceedings{CESIFO2007TheDI,
  title={The devil is in the shadow : do institutions affect income and productivity or only official income and official productivity ?},
  author={AXEL DREHER PIERRE - GUILLAUME M{\'E}ON FRIEDRICH SCHNEIDER CESIFO},
  year={2007}
}
  • AXEL DREHER PIERRE - GUILLAUME MÉON FRIEDRICH SCHNEIDER CESIFO
  • Published 2007
This paper assesses the relationship between institutions, output, and productivity, when official output is corrected for the size of the shadow economy. Our results confirm the usual positive impact of institutional quality on official output and total factor productivity, and its negative impact on the size of the underground economy. However, once output is corrected for the shadow economy, the relationship between institutions and output becomes weaker. The impact of institutions on total… CONTINUE READING