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Informal employment is a widespread phenomenon in Romania. Employees often lack access to social protection or employment benefits, and untaxed envelope payments are common. As the OECD report stated "informality on this scale is a serious problem. It means less tax income for the state and therefore less room to provide infrastructure and public services. The insufficient reach of safety nets to the informal sector renders people vulnerable to economic shock and poverty". Trying to abolish informal employment isn't the solution. A better understanding of the complexity of informal employment is needed. The paper aims to estimate the level of informal employment in Romania at regional level using the labour approach and the discrepancy approach for the period 2000-2013 highlighting the regions with the highest level of informality using the both methods. In order to do that, administrative data from Labour force balance, survey data from Labour Force Survey and data from Labour Cost Survey were used. The empirical analysis based on the methods used revealed that using the labour approach survey data, the regions with the highest level of informality are South-West-Oltenia, South-East and South-Muntenia, while using administrative data the regions North-East, South-West-Oltenia, South-East and South-Muntenia represented poles of informality. Using the second method, the discrepancy approach, the regions with the highest number of persons employed in the informal sector are South-Muntenia, North-East and North-West. The main conclusion regarding the evaluation of informal employment at regional level using different methods of estimation highlighted two main regions as poles of informality-South-Muntenia and Nord-East for the year 2013. [ABSTRACT FROM AUTHOR]

The paper aims to estimate the level of informal employment in Romania and to identify the main informality poles at county level using the labour approach for the period 2000-2013. In order to do that, administrative data from Labour force balance were used providing the official labour use side in the labour market. The empirical approach is based on Crnkovic-Pozaic(1999) and Svec (2009) for Croatia, Nastav şi Bojnec (2007) for Slovenia. The fundamental hypothesis of the labour approach is that the changes in official population activity rates are caused by factors related to the underground economy. One can suppose that the decreasing of this rate could indicate the existence of a flow of population from official to unofficial economy. The analysis based on development regions revealed that Nord-East, South-West-Oltenia and East-South and South-Muntenia are poles of informality at the level of 2013. At county level, Maramures, Bihor, Salaj, Harghita, Covasna, Alba, Botosani, Neamt, Suceava, Gala?i, Braila, Giurgiu, Calarasi, Ilfov, Gorj ?i Caras-Severin are the main poles of informality at local level for the year 2013. Given results are approximatively and show the level of Romanian shadow economy which is presumably underestimated. These phenomena occur because of available statistics and method limitations. [ABSTRACT FROM AUTHOR]

Since transactions between participants in unofficial sector(achived using currency) are undectable it is difficult to obtain a estimation of this sector. The currency is regarded as a superior medium of exchange for conducting underground transactions. The paper aims to estimate the size of informal economy using Gutmann approach for quarterly data covering the period 2000-2014. Thus, the study analyzes the ratio of currency to overnight deposits in order to estimate the amount of informal sector. The main idea behind this approach is that a rise in currency stocks and payments is likely a good indicator of transactions which are not reported to the government authorities. The method requires the choice of a base period where the ratio of currency in circulation to overnight deposits is minimum, and the empirical results are fairly sensitive to the choice. The empirical results pointed out that the ratio of underground economy to official economy reaches the value of 19% at the beginning of 2000 and follows a decreasing trend during the period 2000-2008.From the end of 2008, it begins to increase gradually reaching to about 13% of official GDP in first quarter of 2014. [ABSTRACT FROM AUTHOR]

The size of Romanian shadow economy was estimated using the labour approach covering the period 2000-2009. Two types of data were used: administrative and survey. The empirical results reveal, for both source data (administrative and survey) the existence of a negative relation between activity rates and the estimated value of unofficial employment as expected. The analysis of the data for the period 2001-2009 indicates a substantial difference in the results obtained. While the figures from administrative data report only 800 thousand persons unofficially employed, the survey results reveal about 1900 thousand persons that work in unofficial sector. This difference is due to the different ways of data collecting for the official employment and unemployment. Correlation coefficients for the period 2001-2009 reveal for both types of data (administrative and survey) the presence of a negative relationship between official unemployment and unofficial employment. Given results are approximatively and show the level of Romanian shadow economy which is presumably underestimated. These phenomena occur because of available statistics and method limitations. [ABSTRACT FROM AUTHOR]

This article estimates the size of the Romanian shadow economy (SE) using the currency demand approach, in order to evaluate if there is any relationship between the SE and unemployment rate (UR). Using Granger causality tests and error correction models, we examine the impact of both registered and International Labour Office unemployment rates (ILO_UR) on the Romanian SE covering the period between 2000Q1 and 2010Q2. We find that the Romanian SE as a percentage of official gross domestic product (GDP) is decreasing over the analyzed period, from 36.5 percent at the end of 2000 to 31.5 of real GDP at the middle of 2010. Our empirical results also support a unidirectional Granger causality that runs from the URs to the SE. The generalized impulse response functions indicate the existence of a short-run negative relationship between URs and the Romanian SE. The empirical results also indicate that there is a positive long-run relationship between both URs and SE, with a 1 percent increase in URs leading to an increase in the SE of 0.36 percent due to the registered unemployment rate and an increase of 2.27 percent due to the ILO_UR. [ABSTRACT FROM AUTHOR]

The aim of the paper is to estimate the size of Romanian shadow economy using one of the most used indirect monetary approach, the currency demand approach 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]