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Shadow Economies in Ukraine. Results of the 2019 Survey
Research on the size of shadow economy in Ukraine has been conducted in 2019 by Kyiv International Institute of Sociology under H2020 Project SHADOW, which financed by the European Commission (GA no. 778188).
The task of the project is an exploration of the nature of informal economies and shadow practices in the former USSR region.
SHADOW project has two main aims:
1) estimate the level of shadow economy in 5 counties of the post-USSR region by applying the consolidated methodology used for the three Baltic countries from 2009;
2) enhance capacity of participating researchers and thus their ability to consult national governments and international organizations on how to tackle shadow economies in the region.
Shadow economies conception
Shadow economies sometimes can be regarded as related to corruption and illicit flows (i.e. a large payment to influence policymaking or to cover criminal activities). However, in contrast to illicit transactions and corruption that are mainly feeding criminal activities, their main nature is economic. Accordingly, the main damage they cause is fiscal. They reduce taxable income thus affecting state economic capacity. In other words, a state has less to spend on infrastructure and services for its citizens.