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Open Access
Article
Publication date: 28 April 2023

Sinhle Thwala, Tyanai Masiya and Stellah N. Lubinga

This study aims to investigates the contribution of the informal sector towards secure livelihoods. Using a case study design, the study focusses on Mandela park, situated in…

2572

Abstract

Purpose

This study aims to investigates the contribution of the informal sector towards secure livelihoods. Using a case study design, the study focusses on Mandela park, situated in Khayelitsha Township, Cape Town, in the Western Cape province of South Africa. Khayelitsha is predominantly an old township established by the apartheid government using unjust segregation laws to foster spatial planning that isolated people of colour in areas with insufficient infrastructure and informal economic activities. Therefore, informal trading became a survival strategy in Khayelitsha, attracting an increasing number of informal traders in public spaces within the township in pursuit of livelihoods. Informal activities are generally conducted to generate income and secure sustainable livelihoods.

Design/methodology/approach

This study uses a qualitative research design, incorporating structured interviews instrumental in data collection and in-depth thematic analysis.

Findings

The study findings reveal that the informal sector positively contributes to the sustainable livelihoods of those involved in the informal sector and the relatives of those through income generation, family support, wealth creation, source of employment, business incubation and innovation and creativity.

Originality/value

The study concludes that given the increasing unemployment rate in South Africa, caused by the stagnant economic growth rate, policymakers should rethink their policies on the informal economy, acknowledge the sector's relevance and support the sector.

Details

International Journal of Sociology and Social Policy, vol. 43 no. 13/14
Type: Research Article
ISSN: 0144-333X

Keywords

Open Access
Article
Publication date: 8 July 2022

Busani Moyo

This study aims to investigate the factors that affect the likelihood of formalizing informal sector activities in 13 Sub-Saharan African countries, using World Bank enterprise…

2899

Abstract

Purpose

This study aims to investigate the factors that affect the likelihood of formalizing informal sector activities in 13 Sub-Saharan African countries, using World Bank enterprise survey data collected between the periods 2009 and 2018. Notwithstanding the great contribution of the informal economy in Africa, developing countries may stand to gain more if they make inroads in formalizing the informal sector.

Design/methodology/approach

Since the dependent variable is binary taking the value of one if the firm is willing to formalize and zero otherwise, the study will employ a discrete choice probit model.

Findings

Results inter alia show that firms that are more likely to formalize are young, owned by individuals with high levels of education and, have registered before. Governments should therefore target firms that are young and provide them with information about the benefits of registration, and if these firms are owned by experienced and educated individuals, the likelihood for them to register would be high.

Research limitations/implications

The study uses cross sectional data and therefore cannot capture time variant factors affecting the probability to register and also cannot correct effectively for endogeneity.

Practical implications

Governments should therefore target firms that are young and provide them with as much information as possible about the benefits of registration, and if these firms are owned by experienced and educated individuals, the likelihood to convince them to register would be high. They should also reduce the cost of registration so as to improve net benefits in line with the rational exit view.

Social implications

Formalizing informal activities will help improve the performance of these firms, reduce vulnerable employment as well as crime, poverty and inequality. Providing decent operating and working conditions to informal players will reduce social and political unrest.

Originality/value

The African continent is home to many informal firms accounting for roughly 55% of economic activity with 90% of workers eking out a living in a sector that does not respect worker rights, provide decent working conditions and where changes in growth have done little to reduce its size. Regulatory reforms have also been implemented resulting in the number of start-up registration procedures falling from 11 in 2003 to seven in 2019. The uniqueness of Sub Saharan Africa in terms of entrepreneurial culture, political, institutional and economic conditions as well as lack of consensus in the extant empirical literature make this study pertinent.

Details

African Journal of Economic and Management Studies, vol. 13 no. 3
Type: Research Article
ISSN: 2040-0705

Keywords

Open Access
Article
Publication date: 11 July 2017

Ana Carolina Ogando, Sally Roever and Michael Rogan

This paper explores the perceptions and experiences of women and men who work as informal waste collectors in four different cities. The purpose of this paper is to map out how…

6486

Abstract

Purpose

This paper explores the perceptions and experiences of women and men who work as informal waste collectors in four different cities. The purpose of this paper is to map out how and to what extent occupational, political-legal, economic and social dynamics are experienced differently by gender in a highly vulnerable segment of the urban informal economy, and explore gender differences in these workers’ coping strategies and the levels of action they develop to protect their livelihoods.

Design/methodology/approach

The analysis is based on a mixed methods study which combined a quantitative survey of informal workers with a qualitative participatory methodology. Study participants were drawn from a purposive sample of informal workers who belong to, or are affiliated with, membership-based workers’ organisations. The sample consists of waste pickers (n=614) from Belo Horizonte, Brazil; Bogotá, Colombia; Durban, South Africa; and Nakuru, Kenya.

Findings

The data show that despite significant differences between women and men upon entry into (informal) employment, their perceptions of key drivers and impacts are largely similar, with the exception of concerns around various types of physical security among women. They also indicate that levels of action among men and women waste pickers are only moderately influenced by gender, but are strongly influenced by the degree of organisation in the sector and the symbolic assets held by workers. The findings also illustrate the way in which gendered power dynamics operate within the informal recycling sector and how different levels of sector organisation and development often contribute to opportunities for collective action and, in turn, a reduction in gendered vulnerabilities.

Originality/value

The study offers a new policy angle which connects the level of sector organisation and development with the levels of action taken by informal workers in adapting to different types of shocks, as well as what this means in terms of gender empowerment.

Details

International Journal of Sociology and Social Policy, vol. 37 no. 7/8
Type: Research Article
ISSN: 0144-333X

Keywords

Open Access
Article
Publication date: 13 August 2021

Colin Williams and Jan Windebank

The aim of this paper is to evaluate contrasting ways of tackling self-employment in the informal sector. Conventionally, the participation of the self-employed in the informal

1129

Abstract

Purpose

The aim of this paper is to evaluate contrasting ways of tackling self-employment in the informal sector. Conventionally, the participation of the self-employed in the informal sector has been viewed as a rational economic decision taken when the expected benefits outweigh the costs, and thus enforcement authorities have sought to change the benefit-to-cost ratio by increasing the punishments and chances of being caught. Recently, however, neo-institutional theory has viewed such endeavor as a product of a lack of vertical trust (in government) and horizontal trust (in others) and pursued trust-building strategies to nurture voluntary compliance.

Design/methodology/approach

To evaluate these contrasting policy approaches, data are reported from special Eurobarometer survey 92.1 conducted in 2019 across 28 European countries (the 27 member states of the European Union and the United Kingdom) involving over 27,565 interviews.

Findings

Using probit regression analysis, the finding is that the likelihood of participation in informal self-employment is not associated with the level of expected punishments and chances of being caught, but is significantly associated with the level of vertical and horizontal trust, with a greater likelihood of participation in informal self-employment when there is lower vertical and horizontal trust.

Practical implications

The outcome is a call for state authorities to shift away from the use of repressive policy measures that increase the penalties and chances of being caught and toward trust-building strategies to nurture voluntary compliance. How this can be achieved is explored.

Originality/value

Evidence is provided to justify a shift toward seeking trust-building strategies by state authorities to engender voluntary compliance among the self-employed operating in the informal sector in Europe.

Details

Fulbright Review of Economics and Policy, vol. 1 no. 1
Type: Research Article
ISSN: 2635-0173

Keywords

Open Access
Article
Publication date: 12 November 2020

Aleksandra Webb, Ronald McQuaid and Sigrid Rand

Although the coronavirus (COVID-19) pandemic appears to disproportionately affect those in informal employment, they often receive less government support than the formally…

20735

Abstract

Purpose

Although the coronavirus (COVID-19) pandemic appears to disproportionately affect those in informal employment, they often receive less government support than the formally employed. This paper considers definitions of the informal economy and informal employment, explores the rationale for participating in the informal economy and reflects on some effects of the pandemic on these workers.

Design/methodology/approach

The paper presents a narrative literature review with analysis of the selected academic and policy literature.

Findings

There are considerable short- and long-term implications of the pandemic for informal employment and the informal economy. This occurs against the background of unresolved tensions arising from informal workers' desire for more employment security and employers' striving for continued labour flexibility while transferring costs to government and workers. The COVID-19 pandemic might accelerate current trends and force new solutions to better protect basic work security while helping organisations to remain competitive. Government policies supporting work safety, income security, moves to formalisation of employment and fairness for informal employees are particularly important.

Research limitations/implications

As statistical and qualitative evidence is currently limited, it is too early to identify the full effects of COVID-19 on employment in the informal economy.

Practical implications

The results suggest that governments need to carefully consider explicit support for those in informal employment to create fair, resilient and ethical structures for workers, businesses, economies and wider societies.

Social implications

The paper identifies some of the social implications of COVID-19 for the informal sector.

Originality/value

The analysis offers initial insights into the impacts of a major health, economic and social shock on informal working.

Details

International Journal of Sociology and Social Policy, vol. 40 no. 9/10
Type: Research Article
ISSN: 0144-333X

Keywords

Open Access
Article
Publication date: 9 July 2018

Lissette Aliaga Linares

The purpose of this paper is to challenge the default portrayal of street trade as an informal occupation and spatial practice, by examining comparatively the changes in the…

6277

Abstract

Purpose

The purpose of this paper is to challenge the default portrayal of street trade as an informal occupation and spatial practice, by examining comparatively the changes in the regulatory frameworks of two politically distinct city administrations in Latin America since the introduction of the informal economy debate.

Design/methodology/approach

This paper draws from a comparative case study design to synthesize evidence from historical administrative records, secondary research and materials from a two-year fieldwork carried out in Lima and Bogotá in 2008 and 2009.

Findings

The author argues that the incorporation of the informal economy framework into local governments’ policymaking has reframed street trade as a subject of policy. Since the 1970s, the author traces a shift from worker-centered initiatives, through the deregulation of street trade, to entrepreneurial-centered approaches. Nowadays, both, Lima’s neoliberal governance focusing on “formalizing” and Bogotá’s socialist/progressive governance aiming at “upgrading” street trade respond more explicitly to distinct assessments about the informal economy – legalist and dualist, respectively. Yet, both cities converge in that the closer street trade is perceived as an informal occupation; the more likely policy initiatives decouple the right to work from the right to access public space, spurring more marginal forms of street vending.

Originality/value

Even though the informal economy framework has helped to draw attention to important policy issues locally, nationally and internationally, this paper calls for a critical revision of such framing at the local level to allow for inclusive urban governance.

Details

International Journal of Sociology and Social Policy, vol. 38 no. 7-8
Type: Research Article
ISSN: 0144-333X

Keywords

Open Access
Article
Publication date: 11 July 2017

Birgit Pfau-Effinger

During the transition from socialist to post-socialist regimes, many Central and Eastern Europe societies have developed a broad sector of informal work. This development has…

1983

Abstract

Purpose

During the transition from socialist to post-socialist regimes, many Central and Eastern Europe societies have developed a broad sector of informal work. This development has caused substantial economic and social problems. The paper aims to discuss these issues.

Design/methodology/approach

This paper aims to answer two questions regarding European countries with a relatively weak economy and welfare state: what are the differences in the social characteristics between workers in formal and informal employment? And how might they be explained? According to the main assumption, a key reason why people work in undeclared employment in such countries is that they are in particularly vulnerable positions in the labour market. This paper uses the example of Moldova. The empirical study is based on a unique survey data set from the National Statistical Office of Moldova covering formal and informal employment.

Findings

The findings show that, in informal employment, workers in rural areas, workers with a low level of education, young workers and older workers – in the final years of their careers and after the age of retirement – are over-represented. It seems that a significant reason why these workers are often engaged in informal employment is the lack of alternatives in the labour market, particularly in rural areas, compounded by limited social benefits from unemployment benefits and pensions.

Originality/value

Research about social differences between workers in formal and informal employment in the countries of the European periphery is rare. This paper makes a new contribution to the theoretical debate and research regarding work in informal employment.

Details

International Journal of Sociology and Social Policy, vol. 37 no. 7/8
Type: Research Article
ISSN: 0144-333X

Keywords

Open Access
Article
Publication date: 9 June 2023

Segun Thompson Bolarinwa and Munacinga Simatele

The paper validates the threshold argument in the informality–poverty nexus. Recent literature and policy have argued the existence of a threshold in the relationship.

Abstract

Purpose

The paper validates the threshold argument in the informality–poverty nexus. Recent literature and policy have argued the existence of a threshold in the relationship.

Design/methodology/approach

The study adopts dynamic panel threshold analysis, estimated within the framework of system Generalized Method of Moments (SGMM) to control for endogeneity and simultaneity. Data from 40 selected sub-Saharan African countries between 1991 and 2018 are used for the study.

Findings

Empirical results confirm the existence of an average threshold of 31% share of informality in GDP. Also, the paper finds that threshold of informality that addresses mild and severe poverty varies between 24.32 and 36.75%.

Research limitations/implications

The work is limited to African economies. Evidence from other emerging and developed economies is suggested for further research.

Practical implications

Overall, the empirical results indicate a threshold in the informality–poverty nexus. Therefore, an excessive informality level does not benefit the African growth process. Policymakers and governments are advised to operate within the bounds of the threshold of informality that reduces poverty and improve the African economic growth process.

Originality/value

The paper is the first study to provide empirical findings on the nonlinear and threshold argument in the informality–poverty nexus, as far as the authors know.

Details

African Journal of Economic and Management Studies, vol. 15 no. 1
Type: Research Article
ISSN: 2040-0705

Keywords

Open Access
Article
Publication date: 29 September 2020

Sara Recchi

Informal street vending is traditionally widespread and studied concerning developing countries. Nevertheless, recently, interest in the study of this practice has also increased…

40467

Abstract

Purpose

Informal street vending is traditionally widespread and studied concerning developing countries. Nevertheless, recently, interest in the study of this practice has also increased regarding specific developed countries. The aim of the article is to contribute to overcoming the tendency to investigate this informal economy sector with different analytical lenses between the global South and global North and to highlight the usefulness of analyzing the phenomenon from a comparative perspective.

Design/methodology/approach

Therefore, the article represents a comparative review of the existing literature on informal street vending considering both the global South and global North.

Findings

The analysis revealed similarities and differences in the characteristics the phenomenon assumes in the two areas of the world while at the same time, showing how there are aspects mainly explored in the literature of southern countries and little explored in the literature of northern countries and vice-versa.

Research limitations/implications

This analytical attempt allows us to highlight any gaps present in the literature, which may represent the basis for future comparative research on the topic. Comparative research will improve both theoretical and empirical knowledge of the phenomenon.

Originality/value

On the one hand, the article represents an innovative literature review attempt, as it explicitly compares the street vending between developing and developed countries. On the other hand, it represents the first academic contribution to review street vending in the global North.

Details

International Journal of Sociology and Social Policy, vol. 41 no. 7/8
Type: Research Article
ISSN: 0144-333X

Keywords

Open Access
Article
Publication date: 19 January 2024

Roosa Amanda Lambin and Milla Nyyssölä

Mainland Tanzania has seen two decades of significant social policy reforms and transformations in its social and economic structures, whilst the country continues to grapple with…

333

Abstract

Purpose

Mainland Tanzania has seen two decades of significant social policy reforms and transformations in its social and economic structures, whilst the country continues to grapple with persisting gender inequalities. This article examines Tanzania's social policy developments from a gender perspective. The authors analyse the level, reach and quality of social policy delivery to working-age women across the areas of health policy, social protection and employment policy during 2000–2021.

Design/methodology/approach

The article draws on qualitative research deploying the scoping review method. The data consist of diverse secondary materials, including academic publications, government policy documents, relevant statistics and other types of “grey” literature.

Findings

Tanzania has made significant advancements in the legal frameworks around welfare provision and has instituted increasingly gender-responsive government policy plans. The health and social protection sectors, in particular, have witnessed the introduction of large-scale measures expanding social policy implementation. However, social policy delivery remains two-tiered, with differences in provisions for women in the formal and informal sectors.

Originality/value

Social policy delivery and implementation have increased and diversified in Sub-Saharan Africa (SSA) during the new millennium, with a growing integration of gender-specific policy objectives. However, limited social policy scholarship has focused on the gendered effects of broader social policy models in SSA. The article remedies the concomitant knowledge gaps by examining various social policies and their impacts on working-age women in Mainland Tanzania. The authors also engage with the theoretical welfare regime literature and present an analytical framework for gender-sensitive assessment of emerging social policy models in the Global South.

Details

International Journal of Sociology and Social Policy, vol. 44 no. 13/14
Type: Research Article
ISSN: 0144-333X

Keywords

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