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To transcend the current debates about whether participation in the informal sector is a result of informal workers “exclusion” or their voluntary “exit” from the formal sector, the purpose of this paper is to propose and evaluate the existence of a dual informal labour market composed of an exit-driven “upper tier” and exclusion-driven “lower-tier” of informal workers.

To do this, data from a 2013 Eurobarometer survey involving 27,563 face-to-face interviews across the European Union is reported.

The finding is that in the European Union, there is a dual informal labour market with those participating in the informal sector due to their exclusion from the formal sector being half the number of those doing so to voluntarily exit the formal sector. Using a logistic regression analysis, the exclusion-driven “lower tier” is identified as significantly more likely to be populated by the unemployed and those living in East-Central Europe and the exit-driven “upper tier” by those with few financial difficulties and living in Nordic nations.

The results reveal the need not only to transcend either/or debates about whether participants in the informal sector are universally exclusion-or exit-driven, and to adopt a both/and approach that recognises a dual informal labour market composed of an exit-driven upper tier and exclusion-driven lower tier, but also for wider research on the relative sizes of these two tiers in individual countries and other global regions, along with which groups populate these tiers.

This is the first evaluation of the internal dualism of the informal sector in the European Union.

Participation in the informal economy has been predominantly explained from a supply side perspective by evaluating the rationales for people working in this sphere. Recognising that many transactions in the informal economy are often instigated by customers, exemplified by purchasers asking “how much for cash?”, the purpose of this paper is to explain the informal economy from a demand-side perspective by evaluating citizens’ rationales for making purchases in the informal economy. Here, the authors test three potential explanations for acquiring goods and services in the informal economy, grounded in rational economic actor, social actor and formal economy imperfections theoretical perspectives.

To do this, a 2013 Eurobarometer survey, involving 27,563 face-to-face interviews conducted in 28 European Union member states is reported.

The finding is that all three rationales apply but the weight given to each varies across populations. A multinomial logit regression analysis then pinpoints the specific groups variously using the informal economy to obtain a lower price, for social or redistributive rationales, or due to the failures of the formal economy in terms of the availability, speed and quality of provision.

The outcome is to reveal that the conventional policy approach of changing the cost/benefit ratios confronting purchasers will only be effective for those purchasers citing a lower price as their prime rationale. Different policy measures will be required for those making informal economy purchases due to the shortcomings of the formal economy, and for social ends. These policy measures are then discussed.

The value and originality of this paper is that it explains participation in the informal economy from a purchaser, rather than the predominant supplier, perspective.

Aims to explore the behaviour and preferences of lower income populations when acquiring goods and services. Drawing on empirical evidence from several UK cities, this paper finds that, in the realm of goods acquisition, these consumers want new goods from formal retail outlets but, due to economic necessity, their first option but second choice is often to acquire them informally or second‐hand. In the sphere of consumer services, however, informal modes of provision are frequently preferred by these populations and actively chosen over formal consumer services. The paper concludes by discussing some policy implications of these findings.

The aim of this paper is to evaluate contrasting ways of tackling self-employment in the informal sector. Conventionally, the participation of the self-employed in the informal sector has been viewed as a rational economic decision taken when the expected benefits outweigh the costs, and thus enforcement authorities have sought to change the benefit-to-cost ratio by increasing the punishments and chances of being caught. Recently, however, neo-institutional theory has viewed such endeavor as a product of a lack of vertical trust (in government) and horizontal trust (in others) and pursued trust-building strategies to nurture voluntary compliance.

To evaluate these contrasting policy approaches, data are reported from special Eurobarometer survey 92.1 conducted in 2019 across 28 European countries (the 27 member states of the European Union and the United Kingdom) involving over 27,565 interviews.

Using probit regression analysis, the finding is that the likelihood of participation in informal self-employment is not associated with the level of expected punishments and chances of being caught, but is significantly associated with the level of vertical and horizontal trust, with a greater likelihood of participation in informal self-employment when there is lower vertical and horizontal trust.

The outcome is a call for state authorities to shift away from the use of repressive policy measures that increase the penalties and chances of being caught and toward trust-building strategies to nurture voluntary compliance. How this can be achieved is explored.

Evidence is provided to justify a shift toward seeking trust-building strategies by state authorities to engender voluntary compliance among the self-employed operating in the informal sector in Europe.

France is a model of best practice in the European Union as regards policy to combat undeclared work. The purpose of this paper is to take the country as a case study to evaluate the competing explanations of why people engage in undeclared work which underpin such policy, namely, the dominant rational-economic-actor approach and the more recent social-actor approach.

To evaluate these approaches, the results of 1,027 interviews undertaken in 2013 with a representative sample of the French population are analysed.

The finding is that higher perceived penalties and risks of detection have no significant impact on the likelihood of conducting undeclared work in France. In contrast, the level of tax morale has a significant impact on engagement in the activity: the higher the tax morale, the lower is the likelihood of participation in the undeclared economy. Higher penalties and risks of detection only decrease the likelihood of participation in undeclared work amongst the small minority of the French population with very low tax morale.

Current policy in France to counter undeclared work is informed principally by the rational-economic-actor approach based on a highly developed infrastructure for detection and significant penalties alongside incentives to declare small-scale own-account work. The present analysis suggests that this approach needs to be supplemented with measures to improve citizens’ commitment to compliance by enhancing tax morale.

This case study of a country with a well-developed policy framework to combat undeclared work provides evidence to support the social-actor approach for informing policy change.

This paper argues that by shackling the future of work to a vision of full employment, alternative futures are closed off. At present, employment creation is seen as the sole route out of poverty. Here, however, we reveal that a complementary additional pathway is to help people to help themselves and each other. To show this, evidence from a survey of 400 households in deprived neighbourhoods of Southampton and Sheffield is reported. This reveals that besides creating job opportunities, measures that directly empower people to improve their circumstances could be a useful complementary initiative to combat social exclusion and open up new futures for work that are currently closed off.

To evaluate critically whether under a market system, monetary exchange is always and everywhere based on profit‐seeking behaviour, this article examines cash‐in‐hand work, a form of activity conventionally conceptualised as low paid employment heavily imbued with profit motivations on the part of both the consumer and supplier. Reporting data gathered through structured face‐to‐face interviews with 511 households in affluent and deprived neighbourhoods in two English cities, this article reveals that although most cash‐in‐hand work conducted by people living in affluent suburbs is conducted under social relations akin to employment for profit‐motivated purposes, the vast majority of cash‐in‐hand work in deprived neighbourhoods is undertaken by and for kin, neighbours and friends for a range of cooperative reasons under social relations more akin to unpaid community exchange. Given this heterogeneity of cash‐in‐hand work, this article questions whether seeking its eradication through more stringent regulations is the appropriate policy response, especially in deprived neighbourhoods.

To evaluate critically the view of undeclared work as market‐like activity conducted for monetary gain, and participation as a rational economic decision, and the resultant public policy response that seeks to deter engagement in such work by ensuring that the expected cost of being caught and punished is greater than the economic benefit of participating.

Review of empirical research on the work relations and motives of those engaged in undeclared work.

This paper reveals that although some undeclared work is market‐like and conducted for unadulterated economic reasons, a large proportion is carried out under relations and for motives more akin to unpaid mutual aid, especially in deprived populations.

Evaluating the implications of this finding for a deterrence approach, the argument is that rather than simply seek to eliminate such paid mutual aid through deterrence, a more refined approach is required that combines deterrence with initiatives to facilitate the legitimisation of such work. How this might be achieved is then outlined.

This paper provides the rationale for moving towards a more “joined‐up” public policy approach towards tackling undeclared work and developing social capital rather than treating them as separate policy realms.

In the majority (third) world, informal employment has been long viewed as an asset to be harnessed rather than a hindrance to development. The purpose of this paper is to show how a similar perspective is starting to be embraced in advanced economies and investigates the implications for public policy of this re‐reading.

Documents the shifts in how informal employment in western economies is conceptualised in both the academic literature and public policy.

This paper reveals that the representation of informal employment as an exploitative, low‐paid sweatshop realm is being replaced with a depiction of such work as a hidden enterprise culture that needs to be harnessed. Evaluating how this might be achieved, the need for a shift in public policy away from a deterrence approach and towards an approach that combines deterrents with enabling initiatives to pull this hidden enterprise culture into the formal economy is identified. Specific enabling measures to achieve this in the context of advanced economies are then discussed.

This paper displays how western governments can harness the hidden enterprise culture by setting out specific initiatives to enable its transfer into the formal economy.

This paper provides one of the first attempts to re‐read informal employment as a hidden enterprise culture and to evaluate its implications for public policy.

The purpose of this paper is to explore the reasons women living in dual‐earner households give for not outsourcing domestic chores so as to understand better the barriers to the outsourcing of domestic labour.

The analysis is based on a web questionnaire survey amongst 550 staff of a large service‐sector employer in the UK. Using the Likert scale, reasons why households did or did not outsource domestic chores were investigated.

The two main reasons for not outsourcing which emerged from the research were first, not being able to afford it and second, the satisfaction individuals derived from looking after their own homes.

The first finding concerning affordability reinforces previous research that emphasises income as a determining factor in domestic outsourcing. The second finding that some women do not outsource because they put a positive value on looking after their own homes raises the question of whether the under‐development of domestic outsourcing reflects a culture of resistance to the commodification of private life or evidence of the persistence of traditional ideas concerning domesticity and gender identity.

Many studies of domestic outsourcing have focused on the provider/supplier. Fewer concentrate on the consumer and where this has been done, it has been those who outsource that have been the focus of research. This article contributes to the debate by concentrating on those who do not outsource regular domestic tasks as a way of understanding the barriers to domestic outsourcing.