Why it’s hard to reduce informality in Latin America’s labour market

HER business occupies a small concrete patch in a distant corner of Lima’s wholesale market. There Dora Iparraguirre sells herbs, spinach, cauliflower and cabbage. Her aim is to go up in the world—to the raised, roofed platforms that house bigger stands where lorries can unload directly. Getting one would help her business expand. The platforms are auctioned periodically by the market authority. But to bid Ms Iparraguirre would need a tax-registration certificate.

She says she will try to get one, but it is “complicated” and she doesn’t have the time. “I need to have all the papers, and I don’t know which ones.” She works on her own and says she would need an accountant, but can’t afford to pay one.