Decomposing the Grey Economy in Bulgaria: A General-Equilibrium Analysis


 This paper attempts to assess the size of grey economy, and provide a decomposition by evasion type. The modelling approach utilizes standard micro- founded general-equilibrium setup, which is augmented with revenue-extraction mech- anism government sector. model calibrated Bulgaria after intro- duction currency board (1999-2018). A computational experiment performed within this setup estimates that on average, total bit more than one-fourth output, an estimate in line figures provided both Philip (2014) European Commission (2014). Two-thirds model- predicted combined result income- social security evasion, while rest due VAT evasion.