Conceptions of the dual economy (original) (raw)
The main currents (schools) of thought about the informal economy
The Review of International Comparative Management
Starting from the various interpretations of the concept of "informality", which can be associated with both negative aspects (underground economy, tax evasion, undeclared work, lack of productivity, lack of social protection, unfair competition) and positive aspects (a source for the poor, who have no alternative), this paper aims to review the main conceptual debates over the term "informality", opinions that can be synthesized in four currents or schools of thought, respectively: The dualist school, Structuralist School,
Beyond the formal/informal economy binary hierarchy
2007
Purpose–This paper aims to evaluate critically the conventional binary hierarchical representation of the formal/informal economy dualism which reads informal employment as a residual and marginal sphere that has largely negative consequences for economic development and needs to be deterred. Design/methodology/approach–To contest this depiction, the results of 600 household interviews conducted in Ukraine during 2005/2006 on the extent and nature of their informal employment are reported.
Encyclopedia of Consumer Culture, 2011
The informal economy is defined as all work that is not “formal employment,” by which is meant paid work registered with the state for tax, social security, and labor law purposes. This defining of the informal economy in terms of what it is not accurately displays the centrality of formal employment in contemporary society. The consequence is that the informal economy is a residual catchall umbrella category into which all work that is not formal employment is cast. The result is that multifarious forms of work are brought together under this heading of the informal economy. To differentiate the heterogeneous types of work practice grouped together in this leftover, or residual, category, three broad types of informal work are commonly distinguished. First, there is self-provisioning, which is the unpaid household work undertaken by household members for themselves or for other members of their household. Second, there is unpaid community work, which is unpaid work conducted by household members by and for the extended family, social, or neighborhood networks and more formal voluntary and community groups. Third and finally, there is paid informal work, which is monetized exchange unregistered by or hidden from the state for tax, social security, and/or labor law purposes but which is legal in all other respects. The value of this concept to consumer culture and consumption is that it reveals that the production is not confined to the workplace and consumption to the home but is much more complex and nuanced in contemporary consumer culture.
The state of the informal economy
Focusing on the informal economy, this policy brief addresses whether it is appropriate for development policy purposes to view the economy as a dual economy, made up of a 'first' and 'second' economy. Appropriate policy analysis which would have the greatest impact on improving the lives of those in the informal economy is suggested.
DUAL ECONOMY THEORY REVISITED: GOVERNANCE AND THE ROLE OF THE INFORMAL SECTOR
SASE Conference Paper, 1992
This paper, written and presented in 1992, argued that an adequate understanding of governance in Sub-Saharan Africa requires consideration of not only the economic role of the informal sector, but also its political role. The principal theses are that: (a) The failure of the formal sector in many African countries to contribute to economic growth with equity has been due to its largely static and inflexible character; (b) Dynamic adaptation of the informal sector to changing conditions in both domestic and international arenas has been an important domestic contributor to economic survival in those same African countries; (c) A superficial understanding of the arguments propounded by both the advocates and critics of dual economy theories (during the 1950's and 1960's in particular) contributed to the establishment of counterproductive formal sector economic development policies in African countries; which, in turn, (d) Contributed to the absence of sufficient attention being paid to the dynamic contribution of the informal sector to those economies; (e) The inadequate performance of the formal sector in both economic and political terms resulted in the alienation of formal government structures from the political communities they were expected to serve; and, given that alienation; (f) The requirements of the informal sector (parallel economies) reinforced historically rooted authority structures and/or resulted in the creation of "parallel governments." Given the experience of the last two decades, increasing attention is being given to redressing the imbalance in our understanding of the relative roles of the formal and informal sectors. However, much of that new attention remains too narrowly focused on conventional economic premises. Therefore, this paper argues that reconsideration of those respective roles requires broader consideration of the political and cultural dimensions of the issue. The most important institutional policy implication derived from the above analysis is that legitimating the informal sector (from the perspective of the formal sector) will require: (a) Intermediaries/interlocutors between culturally rooted practices and those of the internationally sanctioned formal sector; and (b) Attention to the legitimacy of informal sector quasi-governmental institutions which are an inherent part of that sector's economic role and behavior. Because current thinking about the role of the informal sector and its relationship to the formal sector in Africa (and elsewhere) is yet in its early stages, this paper is limited to: (i) providing a critique of both the proponents and critics of previous dual economy theories; (ii) outlining the elements of a new, more appropriate, conceptual framework; and (iii) suggesting some implications for applying the suggested conceptual framework to both policy and operational aspects of economic development in Africa. Thus, this paper is limited to setting forth the conceptual argument. Testing the hypotheses of that framework will need further empirical work.
The Political Economy of Informal Economies
The ANNALS of the American Academy of Political and Social Science, 1987
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Social Economy and Informal Economy. Interactions and Effects
Ecoforum, 2016
Both social economy and informal economy define complex economic phenomena, multifaceted, which generated multiple platform debate and analysis among economists, sociologists and lawyers. Perspectives on these concepts are the most diverse and present work attempts to link these views to find common denominators, but also the elements that differentiate them. Official social economy interacts with the informal economy through the initial use of capital and generating links between different forms of capital. Underground economy is based more on use of illicit and immoral capital, while the development of a formal social require networks of trust, reciprocal links with other groups and institutions, social and economic relations that are based on values and norms recognized by society. The interplay of social economy - informal economy is manifested either through a transition from the sphere of the informal (unofficial) to formal (official) or by maintaining and emphasizing undergro...
Da Informalidade à Economia Popular: distinguindo realidades e conectando abordagens
Ciências Sociais Unisinos
Over the last decades, rather than decreasing, informality has grown and furthered debates and studies among academics, activists and policy-makers. Nevertheless, the heterogeneity of the phenomena commonly associated with the concept of informality and correlates, such as informal sector and popular economy, results in a lack of consensus within the current literature. This is partly due to some theoretical and conceptual choices which hinder the formulation of frameworks capable of distinguishing among the various aspects of informality. The first aim of this paper is to clarify some of these issues, such as the prevailing understanding of the various realities that intertwine under the mantle of informality only by contrasting them with the formal economy, the use of all-encompassing concepts of little discriminating value, and, still, the mainstream theories' lack of recognition of the plurality of logics underlying economic institutions and behaviors. Secondly, the paper puts forward a conceptual distinction between informal employment and informal economy, as well as a clearer understanding of the scope of concepts such as informal work and popular economy. In order to capture these nuances, a bottom-up perspective is adopted, allowing to apprehend the informal economy according to its specific features, such as its relational assets and the role fulfilled by the principle of domesticity. Finally, the article stresses the need to recognize the plurality of logics underlying the economy, in order to properly assess the meanings of the economic practices of the popular sectors and their role in development processes.