Informal income opportunities and urban employment in ghana pdf

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Income Insecurity, Job Insecurity and the Drift towards Self-employment in SSA

The social phenomenon is real enough and of some antiquity. The intellectual history of the concept is clearer. It was provoked by the failure of prevalent economic models to address a large part of the world that they claimed to describe. Sociologists, anthropologists, geographers and historians have grasped the opportunity to embarrass economists by pointing out this deficiency.

Some notable attempts have been made to document the economy of the streets. La Vida Very little of all this impinged on the world of development economists. The dualistic models of economic development which prevailed in the s took their lead from W. An influential variant of this approach was put forward by Harris and Todaro Here it was suggested that rural-urban migration in Africa could be modelled by focusing on the discrepancy between urban unskilled wage rates and marginal returns to agricultural labour, allowing for subsidized urban living standards and the urban unemployment rate.

Moreover, he suggested that the aggregate intersectoral relationship between the two sources of employment might be of some significance for models of economic development in the long run. In particular, the informal economy might be a passive adjunct of growth originating elsewhere or its dynamism might be a crucial ingredient of economic transformation in some cases.

This was enough to encourage legions of researchers to adopt the term in the s. The study of Third World urban poverty rapidly became a new segment of the academic division of labour; as a key term in its discourse, the informal economy attracted an unusual volume of debate Bromley, In recent years, British sociologists have applied the term to their own economy, whose formal institutions now employ a smaller proportion of the active labour force than at any time since the s Pahl, For many the term is a convenient name for an unambiguous empirical phenomenon — what you find in the slums of Manila.

Others pay more attention to the logic of conceptual dualism, but vary greatly in their definition of its essence. In all this, insufficient attention has been paid to the intellectual origins of the expression and to its usage in standard English.

This process was in part one of increased formality in economic organization, as manifested in the planning of concrete enterprises and in an increasingly coherent body of economic theory. In this point of view there is a highly formalized part of all Third World economies today, where states, owing their existence in large degree to international institutions and forces, seek with variable effectiveness to establish their writ over economically backward populations.

This is a qualitative distinction, so that questions of size or productivity cannot be intrinsic to its definition. Informality in this context is a matter of degrees of social organization. We all know the difference between formal and informal dancing or dress. But what is form? Form is thus what is regular, predictable, reproducible, recognizable; and it is intrinsic to all social behaviour in some degree.

When we identify something as informal, it is because it fails to reproduce the pattern of some established form. The consequence for economic analysis is obvious. Of course, the people whose activities appear in this light believe that they have social forms which help them to live from day to day; but these forms are usually less powerful and less rigid than those underwritten by state law and immense wealth.

It follows from this that informality is in the eye of the beholder. The informal economy does not exist in any empirical sense: it is a way of contrasting some phenomena with what we imagine constitutes the orthodox core of our economy. Providing that it is self-conscious, such an exercise is almost always beneficial.

Without it we remain trapped in the secular theology of a myopic elite. Economic theory proceeds by means of abstraction; but it is as well to consider from time to time what it has left out. The International Monetary Fund imposes its traditional recipe for formal incorporation of insolvent governments into the official economy without regard for the informal pressures to which they are subject; and the international economic order staggers towards its next crisis.

More insidiously, the media especially the television news reproduce daily the outward signs of the economy — unemployment figures, the exchange rate, share indexes — and our collective understanding fixes on forms without substance.

First, the informal may be the variable content of the form; thus street peddlers of cigarettes invisibly complete the chain linking large foreign firms to consumers. Second, it may be the negation of formal institutions, whether tax evasion, shop-floor resistance or the world traffic in drugs.

The informal economy can then be taken to be an economic variant of the general theory of formal organizations. It is nominalism of the most haphazard sort to claim that the urban poor have an informal economy but their rich masters do not; or that the Third World has an informal sector but not the industrialized West.

As long as there is formal economic analysis and the partial institutionalization of economies around the globe along capitalist or socialist lines, there will be a need for some such remedial concept as the informal economy.

Its application to concrete conditions is likely to be stimulated by palpable discrepancies between prevalent intellectual models and observed realities. Later the accelerating decline of the British economy encouraged some social scientists to adopt the term there.

The common strand is the growing gap between modern states and the wider economic environments that sustain them. Keith Hart. Bromley, R. The urban informal sector: critical perspectives. World Development 6, nos. Harris, J. Urban unemployment in East Africa: an economic analysis of policy alternatives.

East African Economic Review 4 2 , December, 17— Hart, K. Informal income opportunities and urban employment in Ghana. Journal of Modern African Studies 11, 61— International Labour Office. Sethuraman, Geneva: ILO. Lewis, O. New York: Random House. Lewis, W. Economic development with unlimited supplies of labour.

Manchester School of Economics and Social Studies 22 2 , — Mayhew, H. London Labour and the London Poor. Whyte, W. Street Corner Society: the social structure of an Italian slum.

Chicago: University of Chicago Press. Tweet This Post. Pingback: The vital role of the informal economy The Enlightened Economist. You must be logged in to post a comment. Keith Hart Bromley, R. Pahl, R. Divisions of Labour. Oxford: Basil Blackwell.

Informal Income Opportunities and Urban Employment in Ghana

Since the s, one of the key concepts used to analyse the economies of so-called developing countries has been informality. The adoption of this concept by international organizations and its use to account for the economic and social processes of these countries is an ideal field in which to observe how certain phenomena are conceptualized, measured and constructed as focal policy issues. Emergent from the field of anthropology and development, the social life of the concept of informality is linked to its circulation through various disciplines. In this paper, I present the concept of informality, the context of its emergence, its incorporation into the agendas of various international agencies, and the current attempts to re-formulate it. En este trabajo privilegio dos actores en particular: Keith Hart y Paul Bangasser.

It is thesidea that a large number of those working in the informal sector are there voluntarily. In fact, in , I wrote this Fields, , p. When asked theirsreasons for doing what they were doing, ma Many Frafras had poorly paid wage jobs, many had none. I concentrated on the

Economic Growth and Poverty: Does Formalisation of Informal Enterprises Matter?

The Conceptual I argue that while the negative connotations of the concept continue to cast street trade as an aberration from the norm of formalised economic activity, its usage distracts from the causes and conditions of street trade and leads to a narrow focus on business formalisation, with disastrous consequences for traders and city authorities. In the second part, I delineate the legal status of street trade in Tanzania. I wish to express my gratitude to the editors and two anonymous reviewers, and to Juhani Koponen and Marjaana Jauhola for their very constructive comments on earlier drafts.

An informal economy informal sector or grey economy [1] [2] is the part of any economy that is neither taxed nor monitored by any form of government. Although the informal sector makes up a significant portion of the economies in developing countries, it is sometimes stigmatized as troublesome and unmanageable.

The social phenomenon is real enough and of some antiquity. The intellectual history of the concept is clearer. It was provoked by the failure of prevalent economic models to address a large part of the world that they claimed to describe. Sociologists, anthropologists, geographers and historians have grasped the opportunity to embarrass economists by pointing out this deficiency. Some notable attempts have been made to document the economy of the streets. La Vida

This study contributes to the explanation to growing informality by proposing and testing a simple framework that link income insecurity to the proliferation of informal enterprise through job insecurity in selected SSA countries. The analyses suggested that income insecurity exist in the form of significant seasonal variations in sales returns. Enterprises that employ more than one worker, on the average, cut employment significantly during the slowest months as compared to employment in the busiest months. Thus a link is established between income insecurity and job insecurity which deters the informal enterprises from increasing permanent employment and hence remains small overtime. Instead firms resort to casual workers and unpaid workers to facilitate production. The major recommendation of that study is that owners of informal enterprises must be regulated in their current jobs and assisted to build capacity to deal with sales variations and other employment uncertainty after which the demand for formality and growth in decent employment shall be a natural course of action to the firms.


This article originated in the study of one Northern Ghanaian group, the Frafras, as migrants to the urban areas of Southern Ghana. It describes the economic.


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