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In our paper we try to combine the theories explaining the prevalence of informal work, using a regional approach. Reviewing the literature, we observe that, there is no evidence to confirm that the relationships that occur in cross‐country comparisons remain significant when we use regional data and analyse cross‐regional variations. Our general question is therefore whether there is simply more informal work in less‐developed regions, as the modernization theory asserts. Our analysis concludes that there is limited correlation between the prevalence of informal work and a region's level of development, whereas there is a significant positive autocorrelation between the extent of informal work in the analysed voivodships in Poland. [ABSTRACT FROM AUTHOR]

This paper estimates wage curves for formal and informal workers using a rich individual level data for Turkey over the period 2005-2009. The wage curve is an empirical regularity describing a negative relationship between regional unemployment rates and individuals' real wages. While this relationship has been well documented for a number of countries including Turkey, less attention has focused on how this relationship differs for informal versus formal employment. This is of utmost importance for less developed countries where informal employment plays a significant role in the economy. Using the Turkish Household Labour Force Survey observed over 26 NUTS 2 regions, we find that real hourly wages of informal workers in Turkey are more sensitive to variations in regional unemployment rates than wages of formal workers. This is true for all workers as well as for different gender and age groups. [ABSTRACT FROM AUTHOR]