2. Dimensions
Lack of income and productive assets
Lack of basic services
Lack of power
Barriers
Physical: distance, accessibility
Financial: fees, regulations
Legal: registrations, citizenship
Socio-cultural discrimination
Political
poverty and vulnerability
3. Monetized economy
Exclusion by design
Informal costs
Opportunity costs
Urban penalty
Eviction and environmental hazards
Social capital
Information
urban living
4. “Informality is a term that has the dubious distinction
of combining maximum policy importance and political
salience with minimal conceptual clarity and coherence
in the analytical literature.” (Kanbur, 2009)
terms used interchangeably, i.e. informal
economy, informal sector, informal
employment, etc.
difficulty in identifying the boundaries between
formal and informal
misconceptions on the role, contribution and
impact
informality
7. Informality poverty
Large IE = weak FE
Small size limits dynamism & growth
Exploitative
Safety net
Low entry cost
Flexible and heterogeneous
Local knowledge/innovation
perspectives
8. Capabilities
Assets (material and social)
Strategies
A livelihood is sustainable when it can cope with and
recover from external stresses and shocks, maintain or
enhance its capabilities and assets now and in the future
while not undermining the natural resource base.
livelihood
9. Human: skills, knowledge, ability to work,
health
Financial: savings, credit, remittances,
transfers
Social: networks, trust, services
Physical: infrastructure, transport, shelter
capabilities and assets
10. More income
Increased well-being
Reduced vulnerability
Increased resilience
Sustainable living standard
livelihood outcomes
11. Mainly urban Urban and rural
Income raising
• domestic service - e.g. cleaning and childcare (esp. • home gardening
girls and women) • processing, hawking, vending transporting goods
• urban agriculture • casual labour/piece work
• renting out rooms • specialised occupations (e.g. tinkering, food
• multiple jobs (formal/informal) preparation, shoe-shining)
• mortgaging and selling assets
• migration for seasonal work
Lowering expenditure
• scavenging • changes in purchasing habits (e.g. small frequent
• reduce transport costs purchases, rather than cheap bulk buys, and/or poorer
quality food)
• discrimination and triage (e.g. giving less food to
weaker/ less favoured household members).
Social capital
• shared childcare and for elders • mutual help e.g. loans from friends or saving groups
• informal worker’s associations • family splitting
• collective action • remittances from household members working away
Strategies
12. Worldwide: around 66% of total employment
Developed Countries: 25-40% of total
employment
Developing Countries: 50-90% of total
employment
Highest: Sub-Saharan Africa and South Asia
(as high as 90% in many countries)
Medium: South East and East Asia + Latin
America (around 65% in most countries)
Lowest: North Africa and West Asia (around
50% in most countries)
informal is normal
13. It does not mean
Simple regulation and taxation
but also
getting registered and paying taxes
being covered by legal and social protection
receiving support to become productive and
remunerative
becoming organized and gaining voice and
power
(Chen, 2009)
formalization
14. Formalizing the Informal: not just regulation + taxation but
also…
assets + opportunities + productivity-enhancing support
economic rights: commercial + labor + property
social protection
organization and representative voice
“Informalizing” the Formal: reform of economic policies
and institutions to include the informal economy/workforce
as legitimate…
part of the total economy
target of economic policies + incentives
stakeholder in policy-making and rule-setting
institutions
(Chen, 2009)
new urban economy
