This presentation by Iratxe Gupergui from the OECD Competition Division was made during the discussion on Informal Economy during the 2018 edition of the OECD-IDB Latin American and Caribbean Competition Forum held in Buenos Aires, Argentina on 18-19 September 2018. Find all related materials at the forum website http://oe.cd/laccf.

1. Session I: The Informal
Economy in Latin America and
the Caribbean: Implications for
Competition Policy
Iratxe Gurpegui
Competition Expert, Competition Division OECD.
Iratxe.Gurpegui@oecd.org

2. • Informality: largely present in the LAC
economies.
• Negatively impacts the overall economy.
• A traditional concern for agencies in
charge of the design and implementation
of regulations.
Introduction
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3. • Yes,
– if it negatively affects the competitive process; and
– in markets where formal and informal firms effectively
compete.
• Cost advantages of informality have nothing to
do with efficiencies and innovation.
• Formal firms may not be able to match informal
firms prices because costs differences.
Should Competition Agencies care
about informality?
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4. • Competition advocacy ?
– Overly burdensome tax
– Too restrictive labour and product regulation
– Long and costly administrative process
• Competition enforcement? Challenges:
– Notification of decisions
– Calculation of fines
– No complaints from informal firms or antitrust
damage claims
– Market definition and market power
How should competition agencies
tackle informality?
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