Acta Univ. Bohem. Merid. 2026, 29(1):1-17 | DOI: 10.32725/acta.2026.00139

Analysis of the Shadow Economy in the Czech Republic and a Process Model for its Prevention

Milan Douąa1, Darina Koreňová1, Jana Dľunová1
1 Pavol Jozef ©afárik University in Koąice, Faculty of Public Administration, Popradská 66, 040 11 Koąice, Slovak Republic

The shadow economy represents a significant aspect of economic reality in every country. It operates alongside the official economy but remains unrecorded in official statistics. The primary aim of this contribution is to estimate the size of the shadow economy in the Czech Republic and to explain possible sources of inaccuracies in these estimates. A custom estimate of the shadow economy in the Czech Republic will be using the currency demand method, followed by a comparative analysis of the results, and a process model for its prevention will be proposed. This contribution presents an exploration of the shadow economy over the period from 1993 to 2023, with a prediction of the current situation. These findings contribute to a better understanding of the shadow economy phenomenon and provide valuable insights for public policy formulation.

Keywords: shadow economy, currency demand method, currency in circulation, process model, Czech Republic
JEL classification: E26, E41, F41

Received: September 15, 2025; Revised: January 26, 2026; Accepted: June 30, 2026; Prepublished online: June 30, 2026; Published: July 2, 2026  Show citation

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Douąa, M., Koreňová, D., & Dľunová, J. (2026). Analysis of the Shadow Economy in the Czech Republic and a Process Model for its Prevention. Acta Universitatis Bohemiae Meridionalis, 29(1), 1-17. doi: 10.32725/acta.2026.001
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