Economic crisis and “white informal economy” – a slippery slope

Abstract

PurposeThe purpose of this paper is to demonstrate the importance of studying the quasi-legal forms of informal economic behaviour that we know as the white informal economy. The paper also sheds light on the role of the informal economy in the financial crisis that started in 2008. Finally, the aim of the paper is also to encourage empirical research about these concepts.Design/methodology/approachThe paper is theoretical and based on a literature review.FindingsThe paper implies that when discussing about informal economy, different sub-categories should continue to be used in order to distinguish the various forms of informal economic practices. There is a particular need for research on practices of economic activities that are legal but not always moral, yet severely damaging. For such activities, the authors propose the term/categorisation the “white informal economy”. Additionally, the authors argue that in the causal links of events that brought about the financial crisis the role of the white informal economy was significant.Practical implicationsThe paper wishes to encourage further research on the topic of (white) informal economy that in turn would also create the scenario for proper policy development for tackling tax avoidance, tax evasion and future financial crises.Originality/valueThe paper adds to scholarship that takes a critical standpoint towards the financial crisis and to scholarship on the informal economy. It presents an attempt to stimulate further discussion about the connectivity of the informal economy and the financial crisis.