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Economic Freedom - A Vector Of Transition From The Informal To The Formal Economy


  • Corneliu-Sorin BAICU

    () (PhD Student, Stefan cel Mare University of Suceava)

  • Luminita-Claudia CORBU

    () (PhD Student, Stefan cel Mare University of Suceava)


This study aims to show that concerted action by the state and civil society can lead to an effective output of informality sphere by official or legal sphere. Such an action is represented by the vector concept named economic freedom. The resultant vector - economic freedom - is obtained by conjugating and composing of noneconomic factors (ownership freedom, freedom from corruption etc.) or cvasieconomic (fiscal freedom, labor freedom, investment freedom, etc.) and it is a prerequisite to a series of actions which are aimed at progressing progress and a healthy economy. If we cannot eradicate the phenomenon of informality, at least we can create a transition from the informal to the formal more efficiently and with positive effects in social and economic policy. The exit from the sphere of informality involves transitions strategies and not a simple translation from one sector to another.

Suggested Citation

  • Corneliu-Sorin BAICU & Luminita-Claudia CORBU, 2016. "Economic Freedom - A Vector Of Transition From The Informal To The Formal Economy," CES Working Papers, Centre for European Studies, Alexandru Ioan Cuza University, vol. 8(1), pages 20-32, March.
  • Handle: RePEc:jes:wpaper:y:2016:v:8:i:1:p:20-32

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    References listed on IDEAS

    1. Edwin J. Feulner, 2002. "Homeland Defense, Individual Freedom, and the Rule of Law," Journal of Private Enterprise, The Association of Private Enterprise Education, vol. 18(Fall 2002), pages 1-15.
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    Cited by:

    1. Floridi, Andrea & Demena, Binyam Afewerk & Wagner, Natascha, 2020. "Shedding light on the shadows of informality: A meta-analysis of formalization interventions targeted at informal firms," Labour Economics, Elsevier, vol. 67(C).

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      More about this item


      informal economics; formal economics; economic freedom; transition strategies;
      All these keywords.

      JEL classification:

      • O17 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements
      • P48 - Economic Systems - - Other Economic Systems - - - Political Economy; Legal Institutions; Property Rights; Natural Resources; Energy; Environment; Regional Studies
      • H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government


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