Unlicensed work and building are usually pictured as features of developing countries, or of immigrants in rich ones. In fact they run all through ordinary life in wealthy cities. Street vendors, curbside food trucks and front-yard sales all operate largely beyond the reach of regulation.
Informal activity is best understood by where it happens, not just as a type of economic transaction. A sidewalk, a curb, a front yard or a backyard each sets its own possibilities and conflicts. Responses that work in one setting may fail in another.
Homeowners build unpermitted second units such as backyard cottages and in-law apartments. Done house by house, these quietly turn single-family neighborhoods into denser housing. The change happens without any formal decision to rezone.
People without homes have to do private things like sleeping and eating in public space. Those are exactly the activities that rules for public space are written to forbid. The clash cannot be fully settled, so unhoused people get by through informal survival strategies instead.
Planners tend to dismiss informal activity as marginal or criminal. Instead they can learn from it and write rules that bring it into the open. Licensing street food or organizing informal parking markets can turn a nuisance into a working solution.