Shadow Economy Revisited: Logic, Morality And Intuition In Corrupt Practices And Illegal Channels

The aim of the paper is to analyze how corruption contributes to the spread of shadow economy and damages viable economic development of any country. The unfreedoms that are created under the conditions of illegal transactions and corrupt practices considerably limit the opportunities of individuals to develop and use their capabilities (Sen, 2000) to the full extent and make their contribution to the development of their countries' economies and sociocultural progress. The short-sighted desire to receive gain and extra revenue through illegal actions often obscures the capacity to comprehend the size and extent of the damage that such actions bring to the economic development of the country and sociocultural progress of the society in the long run.