Shadow economy determinants of the United States

Abstract

The thesis provides an interdisciplinary literature and empirical research on which determinants have an impact on the size of the shadow economy of the United States in the period of 1991 till 2015 and the size of the impact of these determinants. This is done by applying the Pearson correlation coefficient and a multivariate regression analysis on the data acquired on the variables tax, unemployment rate, GDP per capita, import, export, participation rate, overall government score, regulatory quality, cashless payments, social security contribution and tax morality. It can be concluded that GDP per capita, unemployment rate and tax burden have a significant impact on the size of the shadow economy of the United States. Where tax burden has the largest impact, followed by the unemployment rate and lastly the GDP per capita.