Services purchase from the informal economy using digital platforms

Abstract

ABSTRACT This paper evaluates the extent to which digital platforms are used to purchase services from the informal economy and how this can be tackled. Reporting data from a 2021 survey involving 1209 consumers in Romania, 33% had purchased services from the informal economy and 36% of these purchases had been bought via digital platforms. To explain and tackle this, a logistic regression analysis reveals that informal purchases decrease significantly when both the level of horizontal trust as well as the level of sanctions and risk of detection increase. These results support the use of the holistic approach for tackling informal economy, advocated by the European Platform Tackling Undeclared Work of the European Commission, to achieve progress on the United Nations Sustainable Development Goal (SDG) Indicator 8.3.1 (Proportion of informal employment in non-agriculture employment, by sex).