UN Department of Economic and Social Affairs (DESA) Working Papers

The UN Department of Economic and Social Affairs (DESA) Working Papers aim to stimulate discussion and critical comment on the broad range of economic, social and environmental issues associated with the United Nations Development Agenda.


Modernizing the Informal Sector

The multiplicity of policies proposed to support the informal sector reflects the lack of a common definition. Although they may produce positive effects, these are limited and fail to constitute a comprehensive strategic approach. The different interpretations in the absence of a common definition as well as the strategies emerging from them are reviewed. The identification of informality with illegality and labour precariousness, although conceptually related, is often misleading. Lastly, it explores a strategic option to regulate the informal sector, tracing the different approaches to formalizing informal activities, to facilitate their full integration into the modernization process.


Keywords: informal sector, regulation and informality
JEL: D39: Microeconomics / Distribution / Distribution: Other; O17: Economic Development, Innovation, Technological Change, and Growth / Economic Development / Formal and Informal Sectors; Shadow Economy; Institutional Arrangements; J48: Labor and Demographic Economics / Particular Labor Markets / Particular Labor Markets: Public Policy
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