Economic Informality in Latin America
Causes, Consequences, and Prospects for Transformation
DOI:
https://doi.org/10.22451/5817.ibj2024.vol7.2.11080Abstract
The informal economy (IE), dynamic and omnipresent, generates real obstacles to the development of society. According to the ILO (2018), more than 60% to half of the working population is part of this unregistered economic sector. In this sense, the purpose of this article is to analyze the phenomenon of informality, recognize emerging trends and deepen our understanding of its causes, impacts and possible solutions. A literature review on IE was conducted. Research from academic and government databases was used and contributed to the research. The findings show that the effects of IE translate into low income, limited access to essential public services and tax evasion. It is concluded that addressing the complexity of IE requires an approach that includes multidisciplinary collaboration with the aim of changing attitudes and behaviors and attitudes towards taxation, the potential positive outcomes of which include increased tax compliance, reduced levels of informality and a solid foundation for lasting economic growth.
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