Analysis of the shadow economy in terms of public choice theory in the world and Turkey

The shadow economy, which affects all countries, regardless of their level of development, is a problem that arises as a result of individual interests and needs to be tackled. Many measures have been taken both in the world and Turkey to struggle with the shadow economy and studies have been initiated to reduce the size of the shadow economy. The existence of individual interests on the basis of the shadow economy results in a close relationship with the Public Choice Theory. The principles of the Public Choice Theory and its subjects that constitute the area of interests are based on the shadow economy and cause-effect relationship and consequently, the shadow economy causes serious damage to the countries. The main aim of this study is to determine the shadow economy a concept that must be tackled all over the world, to determine which policies are effective in struggling with the shadow economy and how the desire of people to maximize their interests affects the countries. In this study; the definition of the shadow economy, its fields of activity, sizes, causes and effects of the shadow economy are determined and the importance of the shadow economy is revealed. In addition, the basic principles and assumptions of the Public Choice Theory are discussed and in this context, the relationship with the shadow economy is analyzed. Moreover, the policies implemented to struggle with the shadow economy in the world and Turkey are examined in depth, the results of policies are exposed.