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Shadow Economies in the Digital Age: A LASSO Approach to Measuring the Impact of Digitalization on Informality in Central and Eastern European Countries

  • 2026
  • OriginalPaper
  • Chapter
Published in:
Authors
Marina-Diana Agafiţei
Maria-Bianca Bolboaşă
Adriana AnaMaria Davidescu
Published in
Digital Economy. Emerging Technologies and Business Innovation
Publisher
Springer Nature Switzerland

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Abstract

This study delves into the intricate relationship between digitalization and the shadow economy in Central and Eastern Europe, employing LASSO regression to identify key predictors of informality. The research focuses on four main areas: the impact of digitalization variables such as internet usage and mobile cellular subscriptions, the role of control variables like rule of law and GDP per capita, the varying effects of different calibration methods on the estimates of the informal economy, and the consistent findings across multiple models regarding the predominance of governance and economic factors over digital transformation in influencing informality. The study concludes that while digitalization contributes to reducing informality, its influence is secondary to strong governance, legal structures, and economic development. Policymakers are advised to adopt integrated frameworks that address the root causes of informality and strengthen institutional capacities, with digitalization serving as a complementary tool in formalization strategies.
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Title
Shadow Economies in the Digital Age: A LASSO Approach to Measuring the Impact of Digitalization on Informality in Central and Eastern European Countries
Authors
Marina-Diana Agafiţei
Maria-Bianca Bolboaşă
Adriana AnaMaria Davidescu
Copyright Year
2026
Book
Digital Economy. Emerging Technologies and Business Innovation

Print ISBN: 978-3-032-08602-0

Electronic ISBN: 978-3-032-08603-7

Copyright Year: 2026

DOI
https://doi.org/10.1007/978-3-032-08603-7_16
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