Causes of Option for Informal Sector
Causes of Option for Informal Sector

Summary/Abstract: Informality is a feature, specific to any economy, regardless its nature and development degree, but it has a significant share in developing or poorly developed economies. In this paper we aim to present the causes determine individuals to opt for informality, whether we are talking about the workforce, or we are talking about entrepreneurs or small companies. Therefore, in this paper we will identify what kind of causes determine the labor force (the employees) to opt for informal employment or employment in the informal sector and also what causes determine the entrepreneurs and firms to opt for the informal sector of the economy. We will also try to establish whether the choice for the informal sector of the economy is a rational decision or is an irrational behavior of individuals.

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