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Using Personal Car Register for Measuring Economic Inequality in Countries with a Large Share of Shadow Economy: Evidence for Latvia

Referierte Aufsätze Web of Science

Boriss Siliverstovs, Konstantin A. Kholodilin, Vyacheslav Dombrovsky

In: The Review of Income and Wealth 60 (2014), No. 4, 948-966


We suggest using information from the state register of personal cars as an alternative indicator of economic inequality in countries with a large share of shadow economy. We illustrate our approach using the Latvian pool of personal cars. Our main finding is that the extent of household economic inequality in Latvia is much larger than officially assumed. According to Eurostat, the officially published estimate of the Gini coefficient for Latvia is 0.374 for 2009, which is much higher than the Gini coefficient value reported for all the 27 EU member countries (0.304), but significantly lower than 0.48 according to our results.

Konstantin A. Kholodilin

Research Associate in the Macroeconomics Department

JEL-Classification: D31;E26;Z13
Keywords: cars, economic inequality, Gini coefficient, Latvia, social signaling