This paper aims at assessing the main causes of informal sector in Zimbabwe since independence through literature review. The paper discovered that internal migration (rural to urban), economic slide, wealth creation and tax evasion are some of the main causes of the rapid growth of informal sector and the subsequent decline of the formal sector, in Zimbabwe. The informalization of the economy results in government revenue reduction, collapse of the formal sector and corruption; while identified benefits include creation of employment, as well as lower costs of commodities.
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