The informal sector of Sub-Saharan Africa is comprised of small and household enterprises that operate in the non-farm sector outside the protected employment of the formal wage sector. The sector was identified 40 years ago by the ILO representing a pool of surplus labor that was expected to be...

The shadow (underground) economy plays a major role in many countries. People evade taxes and regulations by working in the shadow economy or by employing people illegally. On the one hand, this unregulated economic activity can result in reduced tax revenue and public goods and services, lower...

The underground economy crucially affects growth and unemployment in both developed and developing countries. Nevertheless, this widespread phenomenon does not appear in the basic model for macroeconomic analysis, namely the Aggregate Demand-Aggregate Supply (or simply AD-AS) model. Therefore,...