Policy Measures to Formalize the Shadow Economy and their Effects on Economic Growth in Serbia

The Foundation for the Advancement of Economics has begun work on the project Policy Measures to Formalize the Shadow Economy and their Effects on Economic Growth in Serbia. The overall goal of the project is to develop a strategy and specific recommendations that will enhance the formalization of the shadow economy in order to improve the competitiveness of the Serbian economy and contribute to economic growth.

The project will address the following four main questions and provide recommendations on practical steps that could lead to a formalization of the shadow economy in a sustainable manner: (i). What are the main causes of the shadow economy in Serbia? (ii) How big is the shadow economy in Serbia and in what sectors, regions and types of activity is it concentrated the most if we look at formal enterprises?  (iii) What are the potential benefits that can be achieved through the formalization of the shadow economy (quantitative, i.e. tax evasion gap, and qualitative)? (iv) How can the government tackle the shadow economy?

Based on all project activities, key problems, weaknesses and impediments to employment in formal economy will be identified and the recommendation for their reform and improvement will be laid out in a clear and accessible manner.