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Informal employment in emerging and transition economies

Author

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  • Fabián Slonimczyk

    (NRU Higher School of Economics, Russian Federation, and IZA, Germany)

Abstract

In developing and transition economies as much as half the labor force works in the informal sector (or “shadow economy”). Informal firms congest infrastructure and other public services but do not contribute the taxes needed to finance them. Informal workers are unprotected against such negative shocks as ill-health, but for certain groups there can be scarce opportunities to enter the formal sector meaning informal employment is the only feasible option. Reducing informality requires better enforcement, more reasonable regulation, and economic growth.

Suggested Citation

  • Fabián Slonimczyk, 2022. "Informal employment in emerging and transition economies," World of Labour, LISER, pages 1-59, March.
    • Handle: RePEc:iza:izawol:journl:2022:n:59
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    Cited by:

    1. is not listed on IDEAS
    2. Ligita Gasparėnienė & Rita Remeikienė & Colin C. Williams, 2022. "Unemployment and the Informal Economy," SpringerBriefs in Economics, Springer, number 978-3-030-96687-4, April.
    3. Juan Pablo Martinez Guzman & Travis St. Clair, 2021. "Pension reform and self‐employment in Latin America," Review of Development Economics, Wiley Blackwell, vol. 25(4), pages 2230-2254, November.
    4. Eloiza Almeida & Veneziano Araújo & Solange Gonçalves, 2025. "The urban wage premium in a labor market with informality," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 74(2), pages 1-28, June.
    5. Bucevska Vesna, 2019. "Determinants of Income Inequality in EU Candidate Countries: A Panel Analysis," Economic Themes, Sciendo, vol. 57(4), pages 397-413, December.
    6. Bargain, Olivier & Etienne, Audrey & Melly, Blaise, 2021. "Informal pay gaps in good and bad times: Evidence from Russia," Journal of Comparative Economics, Elsevier, vol. 49(3), pages 693-714.
    7. Almeida, Eloiza R.F. & Araújo, Veneziano & Gonçalves, Solange L., 2022. "Urban wage premium for women: evidence across the wage distribution," World Development, Elsevier, vol. 159(C).

    More about this item

    Keywords

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    JEL classification:

    • J46 - Labor and Demographic Economics - - Particular Labor Markets - - - Informal Labor Market

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