Religion and the Shadow Economy

31 Pages Posted: 9 Jan 2015

See all articles by Friedrich Schneider

Friedrich Schneider

Johannes Kepler University Linz - Department of Economics; CESifo (Center for Economic Studies and Ifo Institute for Economic Research); Institute for the Study of Labor (IZA)

Katharina Linsbauer

Johannes Kepler University

Friedrich Heinemann

ZEW – Leibniz Centre for European Economic Research; University of Heidelberg - Alfred Weber Institute for Economics

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Date Written: February 2015

Abstract

Religion is increasingly acknowledged to be a cultural dimension which affects economic outcomes in different regards. This contribution focuses on the possible impact of religion's different dimensions, the overall degree of religiosity, the specific impact of different religions, religious competition and the proximity between religion and the state, on the shadow economy. The empirical test matches the largest available cross‐section on the size of the shadow economy with numerous religious indicators. General religiosity seems to increase the shadow economy. Moreover, robust differences emerge across religions. Furthermore, a closer proximity between state and religion is typical for smaller shadow economies.

Suggested Citation

Schneider, Friedrich G. and Linsbauer, Katharina and Heinemann, Friedrich, Religion and the Shadow Economy (February 2015). Kyklos, Vol. 68, Issue 1, pp. 111-141, 2015, Available at SSRN: https://ssrn.com/abstract=2547262 or http://dx.doi.org/10.1111/kykl.12075

Friedrich G. Schneider (Contact Author)

Johannes Kepler University Linz - Department of Economics ( email )

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CESifo (Center for Economic Studies and Ifo Institute for Economic Research)

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Institute for the Study of Labor (IZA)

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Katharina Linsbauer

Johannes Kepler University

Linz
Austria

Friedrich Heinemann

ZEW – Leibniz Centre for European Economic Research ( email )

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L 7,1
D-68034 Mannheim, 68034
Germany

HOME PAGE: http://www.zew.de

University of Heidelberg - Alfred Weber Institute for Economics ( email )

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Heidelberg, D-69117
Germany

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