"Informality" is a term used to describe the collection of firms, workers, and activities that operate outside the legal and regulatory systems. It is widespread in the majority of developing countries-in a typical developing economy, the informal sector produces about 35 percent of gross...

The authors study the effects of regulation on economic growth and the relative size of the informal sector in a large sample of industrial and developing countries. Along with firm dynamics, informality is an important channel through which regulation affects macroeconomic performance and...

July 2000 - In developing countries, increases in current account deficits tend to be associated with a rise in domestic output growth and shocks that increase the terms of trade and cause the real exchange rate to appreciate. Higher savings rates, higher growth rates in industrial economies,...

COVID-19 not only represents a worldwide public health emergency but has become an international economic crisis that could surpass the global financial crisis of 2008-09. Right now, containment and mitigation measures are necessary to limit the spread of the virus and save lives. However, they...

Risk and uncertainty are on the rise, and countries across Europe and Central Asia (ECA) are not immune from it. The region is being hit by crises, conflicts, and continued uncertainty that are negatively affecting people's livelihoods in the short term and prosperity in the long term. Then...

The authors examine how institutions that enforce contracts between two parties - producers and consumers - interact in a competitive market with one-sided asymmetric information and productivity shocks. They compare an informal enforcement mechanism, reputation, the efficacy of which is...

We examine how formal and informal contract enforcing institutions interact in a competitive market with asymmetric information where consumers do not observe quality before purchase. Firm level incentives for producing high quality can be achieved with an informal enforcement mechanism,...