Crime And Fiscal Policy In Europe: The Effect Of Shadow Economy

Eleftherios Goulas, Socrates Karidis

Research output: Contribution to journalArticlepeer-review


We empirically investigate the role of fiscal policies on criminal activity using a sample of 25 EU countries over the period 2000–2013. Our analysis indicates that tight fiscal policies appear to have a positive effect on crime. This effect becomes stronger when property (non-violent) crime rates are considered. Further, the presence of high levels of shadow economy in a country provides a very strong mitigating factor on the adverse effect of public policies on crime. The initially strong link between tight fiscal policy and non-violent crime weakens significantly in the presence of undocumented economic activities which compensate for the lack of formal economic opportunities.
Original languageEnglish
Article number2050017
JournalGlobal Economy Journal
Issue number3
Publication statusPublished - 2 Oct 2020


  • Crime
  • fiscal policy
  • shadow economy

ASJC Scopus subject areas

  • Economics, Econometrics and Finance(all)


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