Posted: March 28, 2015 in Uncategorized

bong mendoza's blog

The essential features of the different types of economic activity are summarized in the following Table 1.

Table 1

Essential Features of Different Types of Economic Activity

Type of economic activity Object of transaction Nature of transaction Tax status Receipts/contracts Transacts with ROTW
Formal Legal goods & services Voluntary exchange Paying Yes Yes
Informal Legal goods & services Voluntary exchange Non-paying No Yes
Criminal Illegal/exclusive goods and services Voluntary and involuntary “exchange” Non-paying No Yes
War-related Illegal/exclusive goods and service Voluntary and involuntary “exchange” Non-paying No/Yes Yes

Interactions between the economic sectors

It is the state that determines which economic activities are criminal and which ones are not.  It does so through a body of laws commonly known as the penal code.  In several instances, agents of the state ‘stretch’ the law to such an extent that some patently criminal activity can be de-criminalized.  In this regard, we can cite…

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