ABSTRACT
The underground economy is universal; it is present in any economic system, in developed market economies, in the socialist/post-socialist countries and in developing economies. The underground economy is present in any economic system; underground activities play a role in each sector of the economy, including those of industry, trade, other services, and even households. An advantage of the model based on residential electricity consumption is that it relies on meso-level analysis, that is, the investigation of the behavior of households. The parameters obtained for the developed market economies were applied to the four post-socialist economies to establish that part of household electricity consumption. These are Hungary, Poland, Czech Republic and Slovakia. The development of electricity consumption allegedly reflects the combined growth of official and underground economies, and they tell the true story about decline of output in these countries between 1989 and 1994.
