Book
Linking the Formal and Informal Economy

Concepts and Policies

The concepts of formal and informal remain central to the theory and practice of development more than half a century after they were introduced into the debate. They help structure the way that statistical services collect data on the economies of developing countries, the development of theoretical and empirical analysis, and, most important, the formulation and implementation of policy. This volume brings together a significant new collection of studies on formality and informality in developing countries. The volume is multidisciplinary in nature, with contributions from anthropologists, economists, sociologists, and political scientists. It contains contributions from among the very best analysts in development studies. Between them the chapters argue for moving beyond the formal-informal dichotomy. Useful as it has proven to be, a more nuanced approach is needed in light of conceptual and empirical advances, and in light of the policy failures brought about by a characterization of the 'informal' as 'disorganized'. The wealth of empirical information in these studies, and in the literature more widely, can be used to develop guiding principles for intervention that are based on ground level reality.

Table of contents
  1. 1. Beyond Formality and Informality
    Basudeb Guha-Khasnobis, Ravi Kanbur and Elinor Ostrom
  2. Part I: Concepts and Measurement
    2. Bureaucratic Form and the Informal Economy
    Keith Hart
    More Working Paper | Formal Bureaucracy and the Emergent Forms of the Informal Economy
  3. Part I: Concepts and Measurement
    3. The Global Path: Soft Law and Non-sovereigns Formalizing the Potency of the Informal Sector
    Robert K. Christensen
  4. Part I: Concepts and Measurement
    4. The Relevance of the Concepts of Formality and Informality: A Theoretical Appraisal
    Alice Sindzingre
  5. Part I: Concepts and Measurement
    5. Rethinking the Informal Economy: Linkages with the Formal Economy and the Formal Regulatory Environment
    Martha Alter Chen
    More Working Paper | Rethinking the Informal Economy
  6. Part I: Concepts and Measurement
    6. Formal and Informal Enterprises: Concept, Definition, and Measurement Issues in India Empirical Studies of Policies and Interlinking
    M. R. Narayana
  7. Part II: Empirical Studies of Policies and Interlinking
    7. The Impact of Regulation on Growth and Informality: Cross-Country Evidence
    Norman V. Loayza, Ana María Oviedo and Luis Servén
  8. Part II: Empirical Studies of Policies and Interlinking
    8. Financial Liberalization in Vietnam: Impact on Loans from Informal, Formal, and Semi-formal Providers
    Robert Lensink, Mark McGillivray and Thi Thu Tra Pham
  9. Part II: Empirical Studies of Policies and Interlinking
    9. Blocking Human Potential: How Formal Policies Block the Informal Economy in the Maputo Corridor
    Fredrik Söderbaum
  10. Part II: Empirical Studies of Policies and Interlinking
    10. Microinsurance for the Informal Economy Workers in India
    Basudeb Guha-Khasnobis and Rajeev Ahuja
  11. Part II: Empirical Studies of Policies and Interlinking
    11. Turning to Forestry for a Way Out of Poverty: Is Formalizing Property Rights Enough?
    Krister Andersson and Diego Pacheco
  12. Part II: Empirical Studies of Policies and Interlinking
    12. Voluntary Contributions to Informal Activities Producing Public Goods: Can These be Induced by Government and other Formal Sector Agents?: Some Evidence from Indonesian Posyandus
    Jeffrey B. Nugent and Shailender Swaminathan
    More Working Paper | Voluntary Contributions to Informal Activities Producing Public Goods: Can These be Induced by Government and Other Formal Sector Agents?
  13. Part II: Empirical Studies of Policies and Interlinking
    13. Social Capital, Survival Strategies, and their Potential for Post-Conflict Governance in Liberia
    Amos Sawyer
    More Working Paper | Social Capital, Survival Strategies, and their Potential for Post-Conflict Governance in Liberia
  14. Part II: Empirical Studies of Policies and Interlinking
    14. Enforcement and Compliance in Lima's Street Markets: The Origins and Consequences of Policy Incoherence Toward Informal Traders
    Sally Roever
    More Working Paper | Enforcement and Compliance in Lima's Street Markets
  15. Part II: Empirical Studies of Policies and Interlinking
    15. Formalizing the Informal: Is There a Way to Safely Unlock Human Potential Through Land Entitlement? A Review of Changing Land Administration in Africa
    Liz Alden Wily
Show all
Endorsements

'No matter how you divide up the developing world - 'formal-informal', 'legal-extralegal' (my preference) - one thing is not debatable: most people are poor, on the outside of the system looking in, and getting angrier every day. The message of this book is it's time to stop talking and start designing reforms based on the informal practices and organizations that poor entrepreneurs already use. I second that motion. If you rebuild the system from the bottom-up, they will come, with their enterprise, creativity, and piles of potential capital.' - Hernando de Soto, President, Institute for Liberty and Democracy, Peru