The impact of the shadow sector of transport services on the economic development of Ukraine’s regions

Abstract

The article analyses aspects of illegal operations in the Ukrainian market of transport services associated with the main types of transport and their relationship with other areas of unreported economic activity. The extent of the shadow sector in the market of transport services in the regions of Ukraine in 2013-2019 was estimated by calculating the shadow economy coefficient for economic activities classified as “Transport, warehousing, postal and courier activities” using the so-called “method of unprofitable enterprises”. The correlation between the coefficient of the shadow economy in the market of transport services and the main indicators of economic development is estimated using regression analysis involving panel data for different regions of Ukraine in the period of 2013-2019. In order to improve the method of assessing the extent of the shadow economy in the transport services sector, a method is proposed which takes into account differences between volume of services provided and consumed.