Informal sector

About: Informal sector is a research topic. Over the lifetime, 12052 publications have been published within this topic receiving 212182 citations.

You Say Illegal, I Say Legitimate: Entrepreneurship in the Informal Economy

Abstract: The entrepreneurial process drives economic activities in the formal economy; however, little is known theoretically about how the entrepreneurial process works in the informal economy. To address this theoretical gap, we employ a multi-level perspective integrating entrepreneurship theory (micro-level) with institutional (macro-level) and collective identity (meso-level) theories to examine the role institutions and collective identity play in the recognition and exploitation of opportunities in the informal economy. Additionally, we explore factors that influence transition to the formal economy.

New Estimates for the Shadow Economies all over the World

Abstract: This paper presents estimations of the shadow economies for 162 countries, including developing, Eastern European, Central Asian, and high income OECD countries over 1999 to 2006/2007. According to our estimations, the weighted average size of the shadow economy (as a percentage of ‘official’ GDP) in Sub-Saharan Africa is 37.6%, in Europe and Central Asia (mostly transition countries) 36.4% and in high income OECD countries 13.4%. We find that an increased burden of taxation (direct and indirect ones), combined with (labour market) regulations and the quality of public goods and services as well as the state of the ‘official’ economy are the driving forces of the shadow economy.

Openness and Wage Inequality in Developing Countries: The Latin American Challenge to East Asian Conventional Wisdom

Abstract: The experience of East Asia in the 1960s and 1970s supports the theory that greater openness to trade tends to narrow the wage gap between skilled and unskilled workers in developing countries. In Latin America since the mid-1980s, however, increased openness has widened wage differentials. This conflict of evidence is probably not the result of differences between East Asia and Latin America. Instead, the conflict is probably the result of differences between the 1960s and the 1980s, specifically, the entry of China into the world market and, perhaps, the advent of new technology biased against unskilled workers.

Informal Sector in Developed and less Developed Countries: A Literature Survey

Abstract: The main goal of this study is two-fold: (1) to provide a general overview of thecontributions to the literature on the informal sector, with a special focus on the PublicChoice approach; and (2) to compare these contributions across two institutionallydifferent types of countries: developed and less developed (developing and transition)countries. The paper focuses on the criteria used to define the informal sector, therelationship between the formal and informal economy, tax evasion, and PublicChoice analysis. It is stressed throughout this paper that the distinction between thetwo types of countries is of key importance.

Decent Work and the Informal Economy

Abstract: The ILO was founded for social justice, a mandate expressed today in terms of decent work as a global goal, for all who work, whether in formal or informal contexts. In June 2002, the delegates to the International Labour Conference from governments, workers’ and employers’ organizations adopted a resolution incorporating conclusions on decent work and the informal economy. The four components of decent work – opportunities for employment and income, respect for rights at work, social protection and stronger social dialogue – form the backbone of the ILO’s approach to the informal economy. These elements can also be seen through a development lens, and necessarily feature a strong gender dimension. To make the action foreseen by the ILC conclusions more easily operational in a cross-disciplinary way, the issues they address can be cast in terms of macro policy, governance, enhancement of productivity, markets and employment, social protection/addressing vulnerabilities, and representation and voice. All play key roles in poverty reduction. Moreover, recognizing the importance of measuring progress towards decent work, developments in relation to indicators are briefly described. This paper includes annexes reproducing the ILC conclusions along with two relevant resolutions adopted by the International Conference of Labour Statisticians and a list of ILO websites that address various aspects of decent work and the informal economy.