In line with the nascent literature on economic complexity, this paper provides answer to a question on whether economic complexity has impact on the size of shadow economy in African economies, a region confronted with a large amount of informal economic operations. We apply four classes of mean group estimators (mean group, augumented mean group, common correlated effects mean group and dynamic common correlated effects mean group) on African panel data of 27 economies over a period of 1995-2017. Findings show that there is no significant evidence to justify that economic complexity affects the size of shadow economy in the mean group. However, in the group-specific coefficients, the relationship is significantly negative for the case of Republic of Congo, Ghana and Uganda, while opposite result is confirmed for Botswana, Madagascar and Tunisia. The study concludes that the impact of economic complexity is heterogeneous for the case of African economies.
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