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Informality, a manifestation of a flawed relationship between citizens and their state, almost always has negative connotations, such as inferior working conditions, low productivity businesses, and unfair competition. This book analyzes informality in Latin America through two distinct but complementary lenses: informality driven by "exclusion" from state benefits or the modern economy, and informality driven by voluntary "exit" decisions resulting from private cost-benefit calculations that lead workers or firms to opt out of formal institutions.