Analysis of the concept of informal economy through 102 definitions: legality or necessity

Abstract

The processes of informal economy are well established, but the same cannot be said of their conceptual treatment in the academic literature. They constitute complex phenomena that cut across sectors and disciplines and give rise to other elements that simultaneously reject and encourage them. For many formal stakeholders in the economy, they are an enemy to be beaten; for the authorities, informal activity is seen as a loss of revenue for the state coffers; for the Sustainable Development Goals, by implicitly recognizing them in goal 8, they constitute a paradigm shift.  Meanwhile, the reality for those involved in the informal economy is that it is a way of life and not a mere choice, one that leads to the most social of all economies: that of necessity. There is no consensus among academics on informality and its ramifications, hence the need to analyze the processes of informal economy from its theoretical construction with the purpose of discovering its range and depth, as well as its interrelationships and theoretical implications. To achieve this, 102 definitions of informal economy were analyzed by identifying and deconstructing their dimensions and performing a frequency count of their citation in Google Scholar. This analysis demonstrated the lack of cultural elements in the definitions, which are the true underlying cause of the phenomenon, and the over-prominence afforded to legal dimensions.