The informal sector refers to those sectors, where social security of related stakeholders is almost missing, and in this sense, it differs from formal sector. In informal sector labors are self-employed, or who work for those who are self-employed. People who earn a living through self-employment in most cases are not on payrolls, and thus are not taxed. Many informal workers do their businesses in unprotected and unsecured places.
Published in Chapter:
Environmental Regulation, International Trade, and Informal Sector: Theory, Policy, and Indian Experience
Tonmoy Chatterjee (Ananda Chandra College, India)
Copyright: © 2019
|Pages: 27
DOI: 10.4018/978-1-5225-8547-3.ch005
Abstract
This chapter deals with some contemporary issues related to trade and environment, which are mainly faced by the developing nations of the world. In this context, the present study has considered some facts and figures of Indian tannery industry for realization of the above-mentioned objective. In this chapter, an attempt has been made to analyze theoretically the effect of both environmental regulation and trade liberalization on the output of different sectors and also on the national welfare in a small open economy. To categorize this, the authors have presented a theoretical model based on the general equilibrium framework that mainly highlights a paradoxical result. Apart from this, the present research shows that the capital used specifically in advanced export sector is likely to affect the welfare positively, and the capital used by the rest of the economy is likely to affect the welfare adversely when usual export sector of the economy vanishes, and the opposite will occur when the pollution-intensive informal sector of the economy vanishes.