The informal economy, innovation and intellectual property- concepts, metrics and policy considerations.

In this working paper, the authors connect concepts, definitions and data regarding the informal economy, innovation, and intellectual property in order to establish a framework for further qualitative and quantitative research and the improvement of public policies in respect of these issues. First, the authors review the literature defining the informal economy, and present an original synthesis of statistical data regarding the informal economy’s social and economic significance. Second, the authors apply established and emerging concepts of innovation to the context of informal systems. Third, the authors discuss a spectrum of appropriation mechanisms, ranging from formal intellectual property rights to informal mechanisms of knowledge protection, sharing and exchange. Fourth and finally, the authors review existing policy approaches toward innovation in the formal economy, and establish a framework to consider future scenarios for the application of intellectual property concepts in this context.