ABSTRACT
This chapter reviews the range of hard direct policy measures that can be pursued to not only dissuade entrepreneurs from operating in the informal sector but also to incentivise and encourage entrepreneurs to operate in the formal sector. The point of these measures is to directly increase the costs and reduce the benefits of informality for entrepreneurs and to reduce the costs and increase the benefits of operating in the formal sector. In an increasing number of countries, certified cash registers are being introduced. A certified cash register consists of two parts: a cash register with a manufacturer declaration and a special control unit, a black box, connected to the cash register. To detect informal entrepreneurship, possible sources of information include audits, data mining of government databases to identify discrepancies and outlier cases, and referrals from other government departments.
