THEORIZING AND UNDERSTANDING TRANSITION (PART I)

The paper aims to analyze the causes or the motivations of the households’ informal economy activities and to estimate the size of the Romanian informal economy. Using data for Romania, it was found that people perceived high taxes as the main cause of the informal activities. The data suggested that the subsistence motive represented the main reason for the households’ decision to operate in the informal economy. It was found that 36.1% of the interviewed households had incomes from a secondary job in 1996. The size of informal economy appears as different because of the method used for computation.