Measuring the Global Shadow Economy
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Measuring the Global Shadow Economy The Prevalence of Informal Work and Labour

The Prevalence of Informal Work and Labour

Colin C. Williams and Friedrich Schneider

This book brings together two leading researchers in the field to provide a comprehensive overview of the shadow economy from a global perspective. Reviewing the advantages and disadvantages of different ways of measuring the informal sector, the authors evaluate its size and key determinants across the world. Williams and Schneider clearly establish the persistence and prevalence of the shadow economy, analysing the narrowness of existing policy approaches and explaining how these fail to address the key factors for its existence and may even exacerbate the problem.
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Chapter 8: Current policy approaches

Colin C. Williams and Friedrich Schneider

Extract

Compared with the voluminous academic literature on measuring and explaining the shadow economy and shadow labour force, much less has been written on how to tackle this realm. Given that the major reason for measuring and explaining the shadow economy and shadow labour force is so that it can be tackled, this major gap in the literature needs to be filled. Part IV of this book seeks to do so. To achieve this, this chapter begins by providing an analytical framework for understanding the current policy approaches that are available and used across the world to tackle the shadow economy and shadow labour force. To commence this analysis of the policy approaches, it is necessary to recognize that until very recently, governments have largely sought to tackle the shadow economy and shadow labour force by seeking to repress this sphere. Today, however, a growing number of governments are no longer seeking to eradicate the shadow economy and shadow labour force. Rather, there has been growing recognition across governments that they are seeking to move the shadow economy and shadow labour into the formal economy (Dekker et al., 2010; European Commission, 2007a; ILO, 2015; Small Business Council, 2004, Williams, 2006a; Williams and Nadin, 2012a, 2012b, 2013, 2014; Williams and Renooy, 2013). The rationale for this shift is several-fold.

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