Informality: Exit and Exclusion: Informality: Exit and Exclusion

Informality: Exit and Exclusion analyzes informality in Latin America, exploring root causes and reasons for and implications of its growth. The authors use two distinct but complementary lenses: informality driven by exclusion from state benefits or the circuits of the modern economy, and driven by voluntary exit decisions resulting from private cost-benefit calculations that lead workers and firms to opt out of formal institutions. They conclude that reducing informality levels and overcoming the culture of informality will require actions to increase productivity, reform regulations and social policies, and strengthen state legitimacy.