The informal economy

If I talk about "informal economy" most of you might think I am talking of activities such as drug trade, prostitution, etc. However, the term refers to all economic activities that are not supervised or overseen by the government, and this applies from the overstock Gap or Polo sales in Sarojini Nagar (a huge market in Delhi) to your 10-year old kid's weekend lemonade stand by a bike trail. The informal economy has its advantages, such as no taxes by governmental institutions or lack of regulations, and disadvantages like "protection" from thugs, police or security contractors (which can easily be higher than taxes) or health hazards.

More on the informal economy in the video below, via Marketwatch. By the way, De Soto's Mystery of Capital in your project 2 reading suggestion list deals with this matter extensively. This could be interesting material for a final project as well: