Knowra Informal economy Informal economy The informal economy consists of economic activities that operate partly or wholly outside formal regulation, taxation, and labor protections. It includes both self-employment and wage work.
Informal employment : Work that lacks formal employment arrangements or protections, such as a contract, social insurance, or labor-law coverage. It describes the jobs through which much informal economic activity is organized.
Keith Hart : A British anthropologist whose 1973 study of urban Ghana introduced the term “informal sector” into development research. His research gave early scholarly form to the concept's modern usage.
Hernando de Soto : A Peruvian economist known for arguing that legal barriers prevent many entrepreneurs from formalizing property and businesses. His account emphasizes regulatory obstacles rather than worker exclusion as a source of informality.
Formal economy : Economic activity conducted within recognized legal, regulatory, tax, and labor-protection systems. It supplies the institutional counterpart to activity classified as informal.
Social protection : Public measures that protect people against poverty and income loss from risks such as illness, unemployment, and old age. Informal workers often lack automatic access to contributory benefits and employment-based coverage.
Street vending : The sale of goods or services in public spaces, often by small-scale traders operating outside full licensing systems. It shows how informal work can be visible and economically organized despite limited permits.
International Labour Organization : A United Nations agency that sets international labor standards and conducts research on work and employment. Its 1972 Kenya report made informal-sector employment central to international labor policy.
Martha Chen : A development scholar whose research centers on informal workers, gender, and policies that support their livelihoods. Her work highlights the diversity and labor conditions hidden by broad informal-sector categories.
Shadow economy : Economic activity deliberately concealed from public authorities, often to evade taxes or regulation. The term stresses concealment, while informal economy also includes visible work with incomplete legal recognition.
Tax base : The income, assets, or transactions that a government can legally tax. Unreported production can narrow the resources available for public services.
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