Open Workshop by Professor Friedrich Schneider: Challenges in Estimating the Shadow Economy

This workshop will address the challenges in estimating the shadow economy, both from the conceptual and empirical viewpoints. First, the MIMIC estimation method is described and criticized and due to a double counting problem a correction is suggested. Second, the measurement methods used for National Accounts Statistics – the discrepancy method and two new micro survey methods – are described and a third, a micro method, using a combination of company manager surveys and their knowledge to calibrate the size of the shadow economy in firms, is presented, too. Third, a detailed comparison of the four micro estimation methods with the MIMIC and the corrected MIMIC method are presented. One major result is that the corrected MIMIC method, especially, comes quite close to various types of lately developed micro survey methods.

Em-Prof. Friedrich Schneider was Professor of Economics at Johannes Kepler University of Linz, Austria (1986 to 2017); retired since October 1, 2017. He obtained his PhD in Economics from the University of Konstanz in 1977. During 1991 to 1996 he was Dean of Social Science and Economics at Johannes Kepler University of Linz and Vice President for Foreign Affairs of the Johannes Kepler University of Linz from 1996-2007. He was President of the Austrian Economic Association during 1997-1999 and from 2005-2008 he was President of the German Economic Association. He has also been consultant to numerous organisations including the Brussels EU Commission, IMF, World Bank. Retired since 10.2017.

He has published extensively in leading Economics journals including The American Economic Review, The Quarterly Journal of Economics, The Economic Journal, Public Choice, Kyklos, and The Journal of Economic Literature. He has also published numerous books including The Shadow Economy (together with Colin C. Williams, The Institute of Economic Affairs, 2013), Readings in Public Choice and Constitutional Political Economy (together with Charles K. Rowley, Springer Publishing Company 2008). He was the editor of the Journal of Public Choice from 1991 to 2004 and Perspektiven der Wirtschaftspolitik from 2000 to 2004.