02169cas a2200337 a 4500 AALejournalIMF011691 230101c9999 xx r poo 0 0eng d 5.00 USD 9781463937089 1018-5941 BD-DhAAL BD-DhAAL Mohommad, Adil. Inclusive Growth, Institutions, and the Underground Economy / Adil Mohommad, Anoop Singh, Sonali Jain-Chandra. Washington, D.C. : International Monetary Fund, 2012. 1 online resource (14 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students Worldwide protests against the perceived lack of economic opportunity and failure of governance have refocused attention on the need for inclusive growth and strong institutions. In developing countries, large informal economies limit state capacity to deliver governance and strong institutions, which in turn discourages participation in and expansion of the formal economy. This paper analyzes the determinants of the underground economy, with particular emphasis on the role of institutions and the rule of law. We find that when businesses are faced with onerous regulation, inconsistent enforcement and corruption, they have an incentive to hide their activities in the underground economy. Empirical analysis suggests that institutions are a more important determinant of the size of the underground economy than tax rates. Mode of access: Internet Economic Activity imf Economy imf Shadow Economy imf Underground Economy imf WP imf Montenegro imf Jain-Chandra, Sonali. Singh, Anoop. IMF Working Papers; Working Paper ; No. 2012/047 Full text available on IMF http://elibrary.imf.org/view/journals/001/2012/047/001.2012.issue-047-en.xml IMF e-Library