An estimation of the hidden economy in Greece (1960-2000)

Abstract

While Hidden Economy (and the Tax Evasion) is a potentially important phenomenon in
the Greek Economy, its implications in our economy only during the last fifteen years, have
started to be examined by the researchers through the construction of econometric models.
Moreover, the issue of Hidden Economy internationally have started to be investigated from the
Economic Institutions mainly from the beginning of 1980's. The work of Gutmann in 1977 gave
the motivation to the other economists to show an interest for the Hidden Economy.
The implementation of nominal convergence criteria of the Greek Economy towards the
zone of Euro, according to Maastricht Treaty, became the cause to be understood the importance
of Hidden Economy phenomenon by the economic policy makers.
The reduction of Hidden Economy will contribute to the drastic diminution of Public Deficits
as well as the Public Debt of the Greek Economy. Today, according to the data of International
Monetary Fund (IMF), Greece is the country with the higher Hidden Economy in E.U.
Particularly, the 1/3 of the Greek Economy, in other words the 28,7% of GDP, is Hidden Economy
and therefore is untaxed.