Smuggling around the world: evidence from a structural equation model

Buehn, Andreas; Farzanegan, Mohammad Reza

doi:10.1080/00036846.2011.570715

Cited by 49 publications

(37 citation statements)

References 41 publications

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“…For example, Buehn and Schneider (2012) find that higher levels of corruption increase the shadow economy. Buehn and Farzanegan (2012) find that higher levels of corruption are associated with higher levels of illegal trade. Thus, by increasing the incentive to go underground, corruption may also deter foreign investors to enter a market.…”

Section: Literature Reviewmentioning

confidence: 94%

Foreign direct investment: the role of institutional and cultural determinants

Lucke

Eichler

2015

Applied Economics

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Using panel data for 29 source and 65 host countries in the period 1995-2009, we examine the determinants of bilateral FDI stocks, focusing on institutional and cultural factors. The results reveal that institutional and cultural distance is important and that FDI has a predominantly regional aspect. FDI to developing countries is positively affected by better institutions in the host country, while foreign investors prefer to invest in developed countries that are more corrupt and politically unstable compared to home. The results indicate that foreign investors prefer to invest in countries with less diverse societies than their own.

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Section: Literature Reviewmentioning

confidence: 94%

Foreign direct investment: the role of institutional and cultural determinants

Lucke

Eichler

2015

Applied Economics

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“…We report the results with CO 2 emissions as an alternative indicator because many other environmental studies focus on CO 2 . 17 MIMIC models have also been applied to special facets of the shadow economy, such as smuggling (e.g., Farzanegan, 2009;Buehn and Farzanegan, 2012). For more details on the theoretical aspect of this methodology, see Bollen (1989).…”

Section: Independent Variablesmentioning

confidence: 99%

Pollution, shadow economy and corruption: Theory and evidence

Biswas

Farzanegan

Thum

2012

Ecological Economics

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147

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“…The first and foremost effort to explain smuggling was carried out by Buehn and Farzanegan (2008). They used a Structural Equation Model (SEM) model with a latent variable while taking in to account multiple causal and indicator variables 4 of smuggling simultaneously to obtain the ordinal index of smuggling in 55 countries around the world during 1991-1999.…”

Section: Literature Reviewmentioning

confidence: 99%

“…Cassar (2001) and Macias (2008) pointed out that a higher official inflation rate may lead to substitution effect from official goods towards underground output and wiped out small businesses which developed black market economy. 9 See, Kaufmann et al (2007); Buehn and Farzanegan (2008). 10 According to Dreher and Schneider (2006), corruption is commonly defined as the misuse of public power for private benefit.…”

Section: Inflationmentioning

confidence: 99%

“…Until now no study has been done which compares the size of smuggling in developed and developing counties. Studies on individual countries have been taken out, only one study by Buehn and Farzanegan (2008) has been done for the whole world with taking only 55 countries. Their study only calculated the ordinal index of smuggling, and did not calibrate the values into absolute values.…”

Section: Introductionmentioning

confidence: 99%

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Smuggling around the World: An Empirical Investigation of Causes and Indicators

Wajid¹,

Aziz²,

Iqbal³

2014

Forman j. econ. stud

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Smuggling is a criminal activity which has been a problem around the world. Keeping in line with the issue, the current study explores the causes and indicators of smuggling for developed and developing countries over the time period 1990-2009 by using MIMIC model. This is the first time that any study has made a comparison of smuggling for developed and developing countries.The results indicate that increase in tariff burden intensifies smuggling, whereas unemployment rate and trade openness has a negative effect on smuggling for both sets of countries. Rule of law and corruption leads to increase in smuggling for developing countries while the same have a negative impact on smuggling in case of developed countries. Education leads to a fall in smuggling for developing countries, while unexpectedly, the same stimulates smuggling in developed countries. Turning to indicator, the labor force participation rate is positively affected by smuggling in developed countries and negatively in developing counties. Smuggling could be reduced while giving incentives to work in the official economy and disincentives to operate in the informal economy.

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Smuggling around the world: evidence from a structural equation model

Cited by 49 publications

References 41 publications

Foreign direct investment: the role of institutional and cultural determinants

Foreign direct investment: the role of institutional and cultural determinants

Pollution, shadow economy and corruption: Theory and evidence

Smuggling around the World: An Empirical Investigation of Causes and Indicators

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