20 Examples of Informal Economy

It is called informal economy or irregular to those commercial or mercantile activities not declared, that is to say, hidden from the fiscal regulations and administrative controls. Together with illegal commercial activities, they constitute the so-called underground economy. For example: begging, divination, piracy, crafts.

The informal economy represents a problem factor for the fiscal health of the nations, not only because of the tax loss of profit, that is, because of what it stops receiving the treasury, but because of unfair competition and the lack of social and retirement compensation that in the long run carries.

Between the common causes Among the informal economy are migration, high unemployment rates, economic hardship and low formal wages.

Examples of informal economy

1. Peddling. It is known by that name to the informal sale of articles of all kinds: groceries, manufactured or semi-finished, without having any method of billing or fiscal control, or conditions of establishment (rent, salary, etc.). These types of sales are usually governed by the
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   supply and demand, when not by the laws of the black market, and they are difficult to regulate given their semi-clandestine nature.
2. Begging. Although it is difficult to consider it an economic activity, it is part of the commercial flows that occur in the city, totally outside of what is accounted for or any system of regulations.
3. Divination. The reading of tarot cards, spiritism, divination by different mystical or ritual practices, are also a form of economic activity outside of any fiscal regulation of the State.
4. The shows to the cap. Informal economy spectacular, musical or circus forms often occur in the transport, traffic lights or public squares, as a way to captivate the passerby and ask for financial help from him.
5. Piracy. In the age of the technological facilities of the Internet and music or video players, there are many who profit from the sale of films, illegally reproduced music or even books, taking advantage of the trends in vogue and without any kind of remuneration for the authors of the material hacked.
6. Prostitution. Although some countries have tried to legalize this trade and establish a certain framework regulatory, the vast majority is exercised free of all kinds of controls and clandestinely, when not illegal.
7. Domestic help. They are generally carried out through verbal agreements and daily cash payment, without this work incurring in any form of social protection, payment of taxes or state regulation.
8. Handicraft. These manufactured products are sold behind the backs of state regulations, since their producer makes them without incurring but their own techniques personal or ancestral.
9. Informal cultural or educational activities. Such as literary workshops, home teaching courses and all kinds of educational exercise that is not registered with any institution or subject to any type of taxation.
10. Popular Reseller Markets. Usually thought from the retail profit of the wholesale merchandise, they usually take place in public spaces, with or without the permission of the local authorities, and mobilize large sums of undeclared capital, although it is possible that as a community they make some type of payment for renting the space or similar items, also informal.
11. The itinerant fruit bowls. Usually provided with a truck in which to transport the stationary fruit, they make tours of informal sales through the heart of cities, without resorting to the formal economy system in absolute.
12. The masseurs. Located mainly in beach or thermal areas, they offer passersby a few minutes of relaxation from a back or neck massage or some chiropractic technique more or less studied. The payment is immediate and in cash, just like the payment of the session.
13. Sellers of undervalued goods. Especially of property, to which the formal sale cost is reduced, that is, the one that appears in the minutes and legal documents, mobilizing the rest of the value of the good off the books.
14. Subsistence planting. What happens when it is planted in small plots or urban land, in order to supply the family's own demand and, eventually, sell the surplus to neighbors or acquaintances.
15. Tips. Either as a complement to a formal service (such as waiters in restaurants) or as a reward for minimal work performed (such as bag packers in some supermarkets).
16. Vehicle sitters. Or parking attendants, “biencuidaos”, “trados” and many other names, they are people who expect a tip in exchange for the alleged surveillance of vehicles parked in the street or help to get out of difficult positions, etc.
17. The glass cleaners. Common in traffic lights, workshops and other urban contexts, they offer to clean drivers' windshields in exchange for a tip.
18. Tourist photographers. Common in areas with a high influx of tourists, they sell photographs as travel souvenirs.
19. The managers. Responsible for expediting or carrying out bureaucratic procedures - often free - on request, in exchange for a stipulated payment.
20. Other professional services in black. This is the name given to the provision of specific professional services of any nature, without incurring in billing of any kind, but is considered the “free exercise of the profession”.