informalitetin

Informalitetin, or informality, is a term used to describe the condition in which activities, institutions, and practices operate outside formal regulatory or administrative frameworks. It encompasses economic, social, and regulatory dimensions; for example, unregistered work, unlicensed businesses, informal settlements, and customary or non-codified practices that lack formal legal status.

Economically, informalitetin often refers to the informal sector or informal employment, where workers and firms are not covered by official registries, taxation, or social protection. Informal institutions include norms, networks, and power relations that influence behavior without formal enforcement. It is measured through indicators such as the share of informal employment in total employment, the proliferation of unregistered firms, and household surveys describing living and working conditions.

Impact and policy: Informality can provide livelihoods and flexibility in economies with limited formal opportunities, but it may reduce tax revenue, weaken social protection, and hinder standardization and governance. Policy approaches aim to reduce barriers to formalization, expand social protection, simplify registration procedures, and improve enforcement in a way that preserves livelihoods. Debates focus on balancing formalization with the need to maintain income security and avoiding disproportionate regulatory burdens. Regional patterns vary: informal sectors are common in many developing countries, while informal practices also appear in sophisticated economies, including gig-work platforms. Critics argue that formalization should be voluntary and rights-based rather than coercive, and that measurement remains challenging due to hidden or underreported activity.