Illegal Immigrants and the Informal Economy in Italy

Abstract

ABSTRACT: The present work is divided into three parts. In the first part the (limited) empirical data relevant to the phenomenon in question is presented, that is, the growing illegality of Italian immigration and the illegal work that immigrants are destined to take up. Obviously the illegality of their presence and the íllicitness of the work are, by definition, phenomena which are difficult to quantify. Some estimates, albeit limited to certain regions, are nevertheless available and the picture that emerges is coherent with the present hypothesis. The hypothesis is then explained at a theoretical level, in the second part, where a simple model of general equilibrium is presented, referring to a two‐sector economy with a single good. The model has the sole aim of illustrating the plausible characteristics of an economy characterised by the phenomenon that this present paper attempts to clarify. In the third part, to give an example, a simulation is put forward, utilising, in the model, values not incoherent with estimates based on Italy as a whole.