informal economy

Moonlighting production, tax rates and capital subsidies

JEL codes: 
E22, E26, H25, H26
Version Date: 
Mar 2011

Informal firms play a crucial role in both developing and developed countries, and there is
evidence of a larger presence of moonlighting firms over ghost firms. The former are firms
that operate simultaneously in the official and unofficial sectors, whereas the ghost firms
undertake their production only underground. In order to deal with this evidence, through an

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