Informality is an umbrella term for a variety of unregulated human activities that go under the radar, stay above or beyond the law, or circumvent different laws or regulations. Informal firms or people may not have access to government services may be surrounded by job insecurity and weak conditions of health and safety, among others. Hence, it is a priority of public and private organizations, and the society at large, facilitate the process of transformation from informality to formality, something we call transformality. It is also important for scholars to better understand the transformality process, which can lead to a better design of policies and initiatives to facilitate transformality. The objective of this project is to develop a systematic literature review (SLR) to better understand the transformality process. Specifically, this SLR seeks to explore: • The barriers that decelerate the transformation from informality to formality. • The accelerators and success factors (internal and external) that facilitate the transformation from informality to formality. • Common features of successful cases of transformation from informality to formality • Common features of failed cases of transformation from informality to formality • Conditions in which the transformation happens. • The role of digitization in the evolution from informality to formality and how informal initiatives are transforming by using digital technologies. This project aims to answer four questions: How has been informality and informal economy defined in the literature? What are the barriers and accelerators involved in the transformality process? What are the common features of successful and unsuccessful transformality processes? Under what conditions transformality occurs? What is the role of digitalization in the transformality process? To answer the research questions, we implement an iterative and integrative six-steps following the recommendations provided by Omwuegbuzie & Frels (2016) and by Rousseau et al. (2008). The investigation is relevant because it looks to find those aspects that are key in the formalization process of ongoing informal business activities. Moreover, identifying the contextual (external) elements that influence transformality, may help policy makers and practitioners design strategies more targeted, efficient and context dependent.
