Advantages and disadvantages of the informal sector?

Answer 1

The informal sector offers several advantages, including flexibility in employment, potential for entrepreneurship, and reduced barriers to entry for workers. It can contribute to economic resilience by providing jobs and income in times of economic downturn. However, disadvantages include lack of job security, absence of legal protections and benefits, and often lower wages, which can perpetuate poverty. Additionally, informal businesses may evade taxation, limiting government revenue and investment in public services.