In this article, the size of informal economy is measured by using the full price method
proposed by Gardes F. (2014). As an extension of this method, price elasticities are reestimated
by integrating the underreported earning shares both for wage workers and selfemployers
from cross-sectional data covering 2003–2006 in Turkey. The contribution of
this paper is threefold: The size of informal economy is estimated by a statistical matching
of the Turkish Family Budget and Time Use surveys through a complete demand system
including full prices. Second, more accurate price and income elasticities are estimated by
using the monetary incomes from informal activities for an emerging economy such as
Turkey. Third, extended full price estimation of demand elasticities allow us to discover
for which consumption group households are more likely to engage in informal work.