The paper analyzes the units of full-time employment (ULA) as estimated by Istat National Accounts. The cyclical analysis can highlight the role that irregular employment (dependent and independent) play on the dynamics of the Italian economy, emphasizing the relationship of substitution between irregular and regular sector. The irregular (both dependent and independent) are not true leading of the cycle, but when the GDP grows, they move earlier, while the regular are slower to adapt. Results from VAR models suggest that there are no connections, contemporaneous correlation or Granger causality, between the dark and the regular side of the Italian market. These findings provide important implications in terms of policy on the complex phenomenon of undeclared work.
Keywords: Keywords: irregular employment, regular employment, regular employees, Irregular employees, business cycle, shadow economy.
Jel Code: J01, J21, J82, J64, C01, P37