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The aim of the paper is to estimate the size of Romanian shadow economy using the currency demand approach of Tanzi for quarterly time series data covering the period 2000-2010. The amount of currency demand is estimated using a cointegration-based error correction mechanism in vector autoregression models. The empirical results indicate that the size of Romanian shadow economy is estimated to be decreasing over the period, reaching at the end of the period about 40 percentage of official GDP. [ABSTRACT FROM AUTHOR]

Currency is widely assumed to have a comparative advantage over checks for the payment of purchases of goods and services that individuals wish to conceal from the authorities. A rise in currency stocks and payments may be taken as a rough indicator of the extent to which these transactions may not be reported to government authorities. The paper aims to estimate the size of subterranean economy using the simple currency ratio method of Gutmann for quarterly data covering the period 1999-2010. In order to do this, the study analyzes the ratio of currency to demand deposits in order to estimate the amount of economic activity in the subterranean economy. The empirical results point out that ratio of underground economy to official economy range between 40-50% of official GNP for the period 1999-2004. At the end of 2004, because of the sharp decline of currency in circulation, the size of the underground economy as percentage of official GNP reaches the value of 10%. In the first quarter of 2010, underground economy measures about 8% of official GNP, showing an increasing trend in recent quarters. [ABSTRACT FROM AUTHOR]

The effects of the financial crisis have been felt more and more acutely in Romania for the last two years. The erosion of the national currency, the massive layoffs in the governmental sector, the severe decrease of real incomes of the employees, the increase in unemployment and inflation and so on, are realities that might degenerate in tensions and economic, social and even political instability. The austerity measures imposed by the government for exiting from the crisis have a strong negative effect on the living standard of most of the population. For this reason, knowledge regarding the changes occurred in the financial behaviour of the households is extremely important, especially when divided by its saving, borrowing and wealth accumulation components. The present paper aims at presenting the main preliminary results of the Household Budget Survey with the experimental questionnaire "Financial placements", the second wave, developed during May 2010, with special reference to the financial behaviour of the households. [ABSTRACT FROM AUTHOR]

Financial investment of households in Romania can be analyzed in the framework of the national economic breakdown as outcomes and effects of the mode of obtaining revenue and also the structure of this revenue (for households). The analysis will proceed further with a study of the possible cause-effect relation between households' financial investment and their movable and immovable assets. Another aspect treated in this paper is the study and the quantitative modeling of the influence of the measures taken by members of households in for diminishing the effects of the crisis and the influence of the financial investments that they prefer. Due to the current economic situation, another issue on which this paper stops is the quantitative analysis of the link between particular types of savings adopted by household members in order to supplement their pension value and the current income sources, assets owned (main house, secondary residences, commercial spaces etc). [ABSTRACT FROM AUTHOR]