The Informel Economy in Algeria: Size, Causes and Consequences

Abstract

The parallel economy is known to be a part of economy which Is hidden on purpose to avoid taxes, laws and regulations, it is being divided into legal sector and illegal sector. It is not included in the government's Gross Domestic Product (GDP).

Although the parallel economy is often associated with developing countries, where up to 60% of the labor forceand 40% of GDP, all economic systems contain an informal economy in some proportion.

Algeria is considered as one of the most important countries that suffered from this problem because of the makeover its economy underwent and which accompanied its historical periods.

The subject matter of our study is to analyze the parallel economy in Algeria in terms of exploring its spread, the reasons behind its increase, as well as, the efficiency of the mechanisms and measures adopted to cope with it.