The definition of digital shadow economy
Abstract
Considering the lack of the scientific studies on the selected topic, the authors of this article raise the aim to set up the definition of digital shadow economy and identify its distinctive features and channels. Thus far, the studies on illegal digital activities have covered ambiguous interpretations of digital shadow economy that incorporated both criminal and economic aspects of the activities performed. The results of the empirical research have enabled to formulate the definition of digital shadow economy that refers to illegal activities, such as digital service provision and sales of goods/services online, when operating exceptionally in digital space, the entities violate the existent legal norms and regulations with a pursuit of illegal mutual interest and material benefits. The newly formulated definition of digital shadow economy has served as a corner-stone for identification of the distinctive features and channels of this phenomenon. Hence, the results of the research may make a significant and weighty contribution to the development of the theory of economics and may raise the awareness of what the phenomenon of digital shadow economy implies.
First published online: 09 Jan 2017
Keyword : shadow economy, digital shadow economy, features of digital shadow economy, channels of digital shadow economy
How to Cite
Remeikiene, R., Gaspareniene, L., & Schneider, F. G. (2018). The definition of digital shadow economy. Technological and Economic Development of Economy, 24(2), 696–717. https://doi.org/10.3846/20294913.2016.1266530
This work is licensed under a Creative Commons Attribution 4.0 International License.
References
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Camarero, C.; Anton, C.; Rodriguez, J. 2014. Technological and ethical antecedents of e-book piracy and price acceptance: evidence from the Spanish case, The Electronic Library 32(4): 542–566. https://doi.org/10.1108/EL-11-2012-0149
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Herwartz, H.; Tafenau, E.; Schneider, F. 2013. One share fits all? Regional variations in the extent of the shadow economy in Europe. Regional Studies. (in press) https://doi.org/10.1080/00343404.2013.848034
Hjort, K.; Lantz, B. 2012. (R)e-tail borrowing of party dresses: an experimental study, International Journal of Retail & Distribution Management 40(12): 997–1012. https://doi.org/10.1108/09590551211274964
Ho, J.; Weinberg, C. B. 2011. Segmenting consumers of pirated movies, Journal of Consumer Marketing 28(4): 252–260. https://doi.org/10.1108/07363761111143141
Hope, K. R. 2001. Indigenous small enterprise development in Africa: growth and impact of the subterranean economy, The European Journal of Development Research 13: 30–46. https://doi.org/10.1080/09578810108426779
Hope, K. R. 2012. The political economy of development in Kenya. New York, NY: Bloomsbury.
Hope, K. R. 2014. Informal economic activity in Kenya: benefits and drawbacks, African Geographical Review 33(1): 67–80. http://doi.org/10.1080/19376812.2013.838687
Holz, T.; Engelberth, M.; Freiling, F. 2012. Learning more about the underground economy: a case-study of keyloggers and dropzones, ESORICS Proceedings 9: 1–18.
Investopedia dictionary. 2015. Definition of black economy [online], [cited 16 October 2015]. Available from Internet: http://www.investopedia.com/terms/b/black-economy.asp
Jacobs, L.; Samli, A. C.; Jedlik, T. 2001. The nightmare of international product piracy, Industrial Marketing Management 30(6): 499–509. https://doi.org/10.1016/S0019-8501(99)00105-4
Levi, M.; Williams, M. L. 2013. Multi-agency partnerships in cybercrime reduction, Information Management & Computer Security 21(5): 420–443. https://doi.org/10.1108/IMCS-04-2013-0027
Libby, R.; Blashfield, R. K. 1978. Applications of item response theory to practical testing problems. Hillsdale, NJ: Erlbaum.
Mello, J. P. 2013. Cybercrime fueled by mature digital underground [online], [cited 10 October 2015]. Identity & Access. Available from Internet: http://www.csoonline.com/article/2133649/identity-access/cybercrime-fueled-by-mature-digital-underground.html
Moore, T.; Clayton, R.; Anderson, R. 2009. The economics of online crime, Journal of Economic Perspectives 23(3): 3–20. https://doi.org/10.1257/jep.23.3.3
Nunnally, J. C.; Bernstein, I. H. 1994. Psychometric theory. 3rd ed. New York: McGraw-Hill.
Petersen, H. G.; Thießen, U. 2010. Editor’s introduction: shadow economy in high income countries – much ado about nothing?, International Economic Journal 24(4): 413–419. https://doi.org/10.1080/10168737.2010.525970
Ponsaers, P.; Shapland, J.; Williams, C. C. 2008. Does the informal economy link to organized crime?, International Journal of Social Economics 35(9): 644–650. https://doi.org/10.1108/03068290810896262
Provos, N.; Rajab, M. A.; Mavrommatis, P. 2009. Cybercrime 2.0: when the cloud turns dark, Commun ACM 52(4): 42–7. https://doi.org/10.1145/1498765.1498782
Putniņš, T. J.; Sauka, A. 2011. Size and determinants of shadow economies in the Baltic States, Baltic Journal of Economics 11(2): 5–25. https://doi.org/10.1080/1406099X.2011.10840498
Schneider, F.; Enste, D. H. 2002. The Shadow Economy. An International Survey. Cambridge: Cambridge University Press.
Schneider, F.; Buehn, A.; Montenegro, C. 2010. New estimates for the shadow economies all over the world, International Economic Journal 24(4): 443–461. https://doi.org/10.1080/10168737.2010.525974
Sirkeci, I.; Magnusdottir, L. B. 2011. Understanding illegal music downloading in the UK: a multi‐attribute model, Journal of Research in Interactive Marketing 5(1): 90–110. https://doi.org/10.1108/17505931111121543
Smith, G. S. 2015. Management models for international cybercrime, Journal of Financial Crime 22(1): 104–125. https://doi.org/10.1108/JFC-09-2013-0051
Startienė, G.; Trimonis, K. 2009. Oficialiai neapskaitytos ekonomikos mastas, Economics & Management 14: 976–983.
Taylor, S. A. 2012. Evaluating digital piracy intentions on behaviors, Journal of Services Marketing 26(7): 472–483. https://doi.org/10.1108/08876041211266404
Vlachos, V.; Minou, M.; Assimakopouos, V.; Toska, A. 2011. The landscape of cybercrime in Greece, Information Management & Computer Security 19(2): 113–123. https://doi.org/10.1108/09685221111143051
Yip, M.; Shadbolt, N.; Tiropanis, N.; Webber, C. 2012. The digital underground economy: a social network approach to understanding cybercrime [online], [cited 09 October 2015]. Digital Futures 2012: The Third Annual Digital Economy All Hands Conference. Available from Internet: http://eprints.soton.ac.uk/343351/1/yip_de2012_submission.pdf
Yu, C. P.; Young, M. L.; Ju, B. C. 2015. Consumer software piracy in virtual communities: an integrative model of heroism and social exchange, Internet Research 25(2): 317–334. https://doi.org/10.1108/IntR-08-2013-0187
Zorz, M. 2015. Global black markets and the underground economy [online], [cited 12 October 2015]. Featured News. Available from Internet: http://www.net-security.org/article.php?id=2288
Woodward, D.; Rolfe, R.; Ligthelm, A.; Guimarães, P. 2011. The viability of informal microenterprise in South Africa, Journal of Developmental Entrepreneurship 16(1): 65–86. https://doi.org/10.1142/S1084946711001719
Amasiatu, C. V.; Shah, M. H. 2014. First party fraud: a review of the forms and motives of fraudulent consumer behaviours in e-tailing, International Journal of Retail & Distribution Management 42(9): 805–817. https://doi.org/10.1108/IJRDM-05-2013-0112
Arli, D.; Tjiptono, F.; Porto, R. 2015. The impact of moral equity, relativism and attitude on individuals’ digital piracy behaviour in a developing country, Marketing Intelligence & Planning 33(3): 348–365. https://doi.org/10.1108/MIP-09-2013-0149
Bossler, A. M.; Holt, T. J. 2012. Patrol officers’ perceived role in responding to cybercrime, Policing an International Journal of Police Strategies & Management: 35(1): 165–181. https://doi.org/10.1108/13639511211215504
Buehn, A.; Schneider, F. 2012a. Shadow economies around the world: novel insights, accepted knowledge, and new estimates, Int Tax Public Finance 19: 139–171. https://doi.org/10.1007/s10797-011-9187-7
Buehn, A.; Schneider, F. 2012b. Corruption and the shadow economy: like oil and vinegar, like water and fire?, Int Tax Public Finance 19: 172–194. https://doi.org/10.1007/s10797-011-9175-y
Camarero, C.; Anton, C.; Rodriguez, J. 2014. Technological and ethical antecedents of e-book piracy and price acceptance: evidence from the Spanish case, The Electronic Library 32(4): 542–566. https://doi.org/10.1108/EL-11-2012-0149
Castro, D.; Bennett, R.; Andes, S. 2009. Steal these policies: strategies for reducing digital piracy [online], [cited 17 October 2015]. The Information Technology and Information Foundation. Available from Internet: https://itif.org/publications/2009/12/15/steal-these-policies-strategies-reducing-digital-piracy
Cronan, T. P.; Al-Rafee, S. 2008. Factors that influence the intention to pirate software and media, Journal of Business Ethics 78(4): 527–545. https://doi.org/10.1007/s10551-007-9366-8
Dell’ Anno, R.; Solomon, O. H. 2008. Shadow economy and unemployment rate in USA: is there a structural relationship? An empirical analysis, Applied Economics 40(19): 2537–2555. https://doi.org/10.1080/00036840600970195
Dion, M. 2011. Corruption, fraud and cybercrime as dehumanizing phenomena, International Journal of Social Economics 38(5): 466–476. https://doi.org/10.1108/03068291111123156
Dittrich, D. 2009. Malware to crimeware: how far have they gone, and how do we catch up?, Login 34(4): 35–44.
Dobson, S.; Sukumar, A.; Tipi, L. 2015. Dark matters: the institutional entrepreneurship of illicit and il¬legal cyberspace, in G. Mcelwee, R. Smith (Eds). Contemporary Issues in Entrepreneurship Research, Volume 5: Exploring Criminal and Illegal Enterprise: New Perspectives on Research, Policy & Practice. Emerald Group Publishing Limited, 179–201. http://doi.org/10.1108/S2040-724620150000005014
Government Accounting Office (GAO). 2007. Cybercrime: Public and Private Entities Face Challenges in Addressing Cyber Threats [online], [cited 10 October 2015]. United States Government Accountability Office Report to Congressional Requesters. Available from Internet: www.gao.gov/new.items/d07705.pdf
Hafezieh, N., Akhavan, P.; Eshraghian, F. 2011. Exploration of process and competitive factors of entrepreneurship in digital space: a multiple case study in Iran, Education, Business and Society: Contemporary Middle Eastern Issues 4(4): 267–279. https://doi.org/10.1108/17537981111190051
Haines, J.; Johnstone, P. 1999. Global cybercrime: new toys for the money launderers, Journal of Money Laundering Control 2(4): 317–325. https://doi.org/10.1108/eb027198
Herley, C.; Florencio, D. 2010. Nobody sells gold for the price of silver: dishonesty, uncertainty and the underground economy [online], [cited 10 October 2015]. Economics of Information Security and Privacy. Available from Internet: https://link.springer.com/chapter/10.1007%2F978-1-4419-6967-5_3#page-1
Herwartz, H.; Tafenau, E.; Schneider, F. 2013. One share fits all? Regional variations in the extent of the shadow economy in Europe. Regional Studies. (in press) https://doi.org/10.1080/00343404.2013.848034
Hjort, K.; Lantz, B. 2012. (R)e-tail borrowing of party dresses: an experimental study, International Journal of Retail & Distribution Management 40(12): 997–1012. https://doi.org/10.1108/09590551211274964
Ho, J.; Weinberg, C. B. 2011. Segmenting consumers of pirated movies, Journal of Consumer Marketing 28(4): 252–260. https://doi.org/10.1108/07363761111143141
Hope, K. R. 2001. Indigenous small enterprise development in Africa: growth and impact of the subterranean economy, The European Journal of Development Research 13: 30–46. https://doi.org/10.1080/09578810108426779
Hope, K. R. 2012. The political economy of development in Kenya. New York, NY: Bloomsbury.
Hope, K. R. 2014. Informal economic activity in Kenya: benefits and drawbacks, African Geographical Review 33(1): 67–80. http://doi.org/10.1080/19376812.2013.838687
Holz, T.; Engelberth, M.; Freiling, F. 2012. Learning more about the underground economy: a case-study of keyloggers and dropzones, ESORICS Proceedings 9: 1–18.
Investopedia dictionary. 2015. Definition of black economy [online], [cited 16 October 2015]. Available from Internet: http://www.investopedia.com/terms/b/black-economy.asp
Jacobs, L.; Samli, A. C.; Jedlik, T. 2001. The nightmare of international product piracy, Industrial Marketing Management 30(6): 499–509. https://doi.org/10.1016/S0019-8501(99)00105-4
Levi, M.; Williams, M. L. 2013. Multi-agency partnerships in cybercrime reduction, Information Management & Computer Security 21(5): 420–443. https://doi.org/10.1108/IMCS-04-2013-0027
Libby, R.; Blashfield, R. K. 1978. Applications of item response theory to practical testing problems. Hillsdale, NJ: Erlbaum.
Mello, J. P. 2013. Cybercrime fueled by mature digital underground [online], [cited 10 October 2015]. Identity & Access. Available from Internet: http://www.csoonline.com/article/2133649/identity-access/cybercrime-fueled-by-mature-digital-underground.html
Moore, T.; Clayton, R.; Anderson, R. 2009. The economics of online crime, Journal of Economic Perspectives 23(3): 3–20. https://doi.org/10.1257/jep.23.3.3
Nunnally, J. C.; Bernstein, I. H. 1994. Psychometric theory. 3rd ed. New York: McGraw-Hill.
Petersen, H. G.; Thießen, U. 2010. Editor’s introduction: shadow economy in high income countries – much ado about nothing?, International Economic Journal 24(4): 413–419. https://doi.org/10.1080/10168737.2010.525970
Ponsaers, P.; Shapland, J.; Williams, C. C. 2008. Does the informal economy link to organized crime?, International Journal of Social Economics 35(9): 644–650. https://doi.org/10.1108/03068290810896262
Provos, N.; Rajab, M. A.; Mavrommatis, P. 2009. Cybercrime 2.0: when the cloud turns dark, Commun ACM 52(4): 42–7. https://doi.org/10.1145/1498765.1498782
Putniņš, T. J.; Sauka, A. 2011. Size and determinants of shadow economies in the Baltic States, Baltic Journal of Economics 11(2): 5–25. https://doi.org/10.1080/1406099X.2011.10840498
Schneider, F.; Enste, D. H. 2002. The Shadow Economy. An International Survey. Cambridge: Cambridge University Press.
Schneider, F.; Buehn, A.; Montenegro, C. 2010. New estimates for the shadow economies all over the world, International Economic Journal 24(4): 443–461. https://doi.org/10.1080/10168737.2010.525974
Sirkeci, I.; Magnusdottir, L. B. 2011. Understanding illegal music downloading in the UK: a multi‐attribute model, Journal of Research in Interactive Marketing 5(1): 90–110. https://doi.org/10.1108/17505931111121543
Smith, G. S. 2015. Management models for international cybercrime, Journal of Financial Crime 22(1): 104–125. https://doi.org/10.1108/JFC-09-2013-0051
Startienė, G.; Trimonis, K. 2009. Oficialiai neapskaitytos ekonomikos mastas, Economics & Management 14: 976–983.
Taylor, S. A. 2012. Evaluating digital piracy intentions on behaviors, Journal of Services Marketing 26(7): 472–483. https://doi.org/10.1108/08876041211266404
Vlachos, V.; Minou, M.; Assimakopouos, V.; Toska, A. 2011. The landscape of cybercrime in Greece, Information Management & Computer Security 19(2): 113–123. https://doi.org/10.1108/09685221111143051
Yip, M.; Shadbolt, N.; Tiropanis, N.; Webber, C. 2012. The digital underground economy: a social network approach to understanding cybercrime [online], [cited 09 October 2015]. Digital Futures 2012: The Third Annual Digital Economy All Hands Conference. Available from Internet: http://eprints.soton.ac.uk/343351/1/yip_de2012_submission.pdf
Yu, C. P.; Young, M. L.; Ju, B. C. 2015. Consumer software piracy in virtual communities: an integrative model of heroism and social exchange, Internet Research 25(2): 317–334. https://doi.org/10.1108/IntR-08-2013-0187
Zorz, M. 2015. Global black markets and the underground economy [online], [cited 12 October 2015]. Featured News. Available from Internet: http://www.net-security.org/article.php?id=2288
Woodward, D.; Rolfe, R.; Ligthelm, A.; Guimarães, P. 2011. The viability of informal microenterprise in South Africa, Journal of Developmental Entrepreneurship 16(1): 65–86. https://doi.org/10.1142/S1084946711001719