Cash transactions for goods and services in which no receipts are issued greatly increase the risk of tax evasion. Despite the availability of banking services and alternative payment, key sectors of the economy remain largely cash-based in almost all developing countries. This paper shows the...

The informal sector deprives states of revenues and workers of social protection. It also, however, frequently constitutes the most dynamic part of the economy and creates massive employment. Informal employment is ubiquitous and growing. The financial crisis that began in 2008 has made the...

In developing countries, informal firms (those that are not registered with the government) account for about half of all economic activity. We consider three broad views of the role of such firms in economic development. According to the romantic view, these firms would become the engine of...