The problem is, the low-overhead business model I described above for the informal economy is, in almost countless ways, illegal. Take the restaurant/brew pub example. You have to buy an extremely expensive liquor license, as well as having an industrial sized stove, dishwasher, etc. And that level of capital outlay can only be paid off with a large dining room and a large kitchen-waiting staff, which means you have to keep the place filled or the overhead costs will eat you alive. These high entry costs and the enormous overhead are the reason you can’t afford to start out really small and cheap, and the reason restaurants have such a high failure rate. It’s illegal to use the surplus capacity of the ordinary household items we have to own anyway but remain idle most of the time, because of zoning and “safety” regulations which make it prohibitively expensive to sell a few hundred dollars surplus a month from the household economy. You can’t do just a few thousand dollars worth of business a year, because the state mandates capital equipment on the scale required for a large-scale business if you engage in the business at all.
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