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Regional Economics: Theory and Practice

Theoretical approaches to defining the shadow economy

Vol. 19, Iss. 12, DECEMBER 2021

Received: 10 May 2021

Received in revised form: 28 July 2021

Accepted: 29 October 2021

Available online: 14 December 2021


JEL Classification: H26, Н27

Pages: 2325–2344


Elena V. PECHERITSA Saint-Petersburg State Economic University (SPbSEU) St. Petersburg, Russian Federation


Ol’ga S. NADEZHINA Peter the Great St. Petersburg Polytechnic University, St. Petersburg, Russian Federation


Svetlana I. GOLOVKINA Peter the Great St. Petersburg Polytechnic University, St. Petersburg, Russian Federation

ORCID id: not available

Subject. This article explores the forms of the shadow economy.
Objectives. The article aims to identify conceptual differences between approaches to defining the shadow economy notion.
Methods. For the study, we used logical, comparative, and content analyses.
Results. The article finds that the concept of the shadow economy includes both illegal activities, which contradict the spirit and letter of the law, and legal activities, through using illegal tools and methods to maximize profits or minimize costs.
Conclusions. Social, legal, and economic factors determine the development of the shadow economy. Whether money comes back to the legal economy sector or not, it depends on the form of the shadow economy. To define the essence of the shadow economy, a comprehensive approach is required.

Keywords: informal economy, economic relations, economic systems


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