The last decades, many scholars highlighted the shadow
economic activities, regarding their disadvantages (unemployment, impoverishment
etc) and advantages (intensifies competition, flexibility in employment etc).
During the financial crisis, informal activities rose in noisy way, which
triggered the development of special definitions to describe a wide range of
actions which in turn have gradually configured and updated the content of the
shadow economy term. In this paper we present the theoretical background of the
shadow economy term, by selecting the main worldwide literature published from
1973 to 2018. Many studies have tried to definite the shadow economy term but
none has ever presented explicitly the adjectives and nouns that are related to
shadow economy. Taking into account this analysis it would be useful for the
scholars to mention extensively the theoretical background about shadow
economy, the critiques towards the school of thoughts, in order to choose the
appropriate term in each case and to design and implement the indicative method
to estimate the size of the shadow economy.
JEL classification numbers: E26
Keywords: shadow economy, informal economy, informal sector,
shadow banking, tax havens, off shore financial centers.