Econometric Analysis of the Macroeconomic Determinants of the Informal Economy in Morocco over the Period 1993–2020

Abstract

The persistence of the informal economy poses a structural challenge for developing economies, both in terms of its scale and its implications for growth, employment, and government tax revenues. Although widely documented, understanding of its macroeconomic drivers remains incomplete, particularly with regard to the nature of the dynamic relationships between the informal economy and its explanatory factors. In this perspective, the adoption of econometric approaches capable of simultaneously capturing interdependencies and adjustment mechanisms is particularly relevant. Using macroeconomic data on Morocco covering the period 1993–2020, this study employs an ARDL (Autoregressive Distributed Lag) model to examine the interactions between the informal economy and its main determinants. The objective is to provide empirical insights that can enrich the academic debate and inform the discussion on formalization policies adapted to Morocco's economic realities. This work contributes to the literature by emphasizing the importance of identifying the determinants of the informal economy as a prerequisite for any formalization strategy.

Classification JEL : E26, G20, O17

Paper type : Empirical Research