Choice Review

As the economies of Latin American countries have declined during the last dozen years, the "informal economy" of Latin America has grown rapidly. The persisting debt crisis has resulted in a large expansion of unemployment and underemployment, and increasingly large numbers of people have been pushed into the portions of the Latin American economies that escape government regulations, many taxes, and provisions of labor laws. This collection deals particularly with the question of illegality of the informal economy. Together, the essays make several major points. One is the difficulty of precisely defining "legal" and "illegal" activities; all writers agree that firms generally considered "informal" are actually somewhere between being totally legal and totally illegal. Second, the kind of legality most often achieved is basic registration of businesses. Third, the kind of laws these firms most often violate deal with labor: unionization (virtually nonexistent in the informal sector), and particularly legal fringe benefits and social security. The authors are generally convinced that the principal impediments to informal firms becoming legal are not excessive regulation, but conditions of the macroeconomy. Unemployment, underemployment, and general economic crisis have been the principal factors expanding and sustaining the informal economy. This book will interest Latin Americanists and those concerned with the current crusade to privatize and end government regulation in Latin America and many other countries. Advanced undergraduate through professional. R. J. Alexander; Rutgers, The State University of New Jersey, New Brunswick