An Economist's View of the Informal Economy: Interview with Friedrich Schneider 29.Jan.2021 9:00 AM . 5 min read Friedrich Schneider is a Professor of Economics at Johannes Kepler University in Linz, Austria and a Research Fellow at the Institute of Labor Economics in Bonn, Germany. First off, how can we define the informal economy? What sort of academic debates have gone on regarding the definition of the informal economy? The informal economy is also called the shadow economy or the gray economy, there are lots of names for it. To be brief, the informal economy consists of goods and services which are produced in the shadow, avoiding taxes and government regulations, but are legal. Legality is important. If I repair a car off the books, it’s running afterwards, and it’s a legal activity, which is different from illegal activities such as drug dealing or burglary or other classical criminal activity.