Linking the Formal and Informal Economy: Concepts and Policies

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more nolume brings together a significant new collection of studies on formality and informality in developing countries. Containing contributions from some of the very best analysts in development studies, the volume is multidisciplinary in nature, with contributions from anthropologists, economists, sociologists, and political scientists.

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Editorial Reviews

From the Publisher
"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

UNEDITED UK REVIEW: "The obvious is not necessarily the best. For many, a well-defined set of formal institutions is the obvious road to economic success. Academic analysts are attracted by the parsimony of formal institutions. Policy makers appreciate the apparent predictability of the effect on addressees. Constitutional lawyers prefer formal institutions since they lend themselves to ex post control. Yet as the book convincingly demonstrates, in many contexts, and in developing countries in particular, going for the obvious is bad policy. Imposing a small set of formal institutions forces all economic activity into a Procrustes' bed. Often, a clever mixture of formal and informal elements has two main advantages: harnessing new resources for corporate governance, and making the firm more responsive to its environment, be it demand, competition or regulatory expectations."—Christoph Engel, Max Planck Institute for Research on Collective Goods, Bonn

UNEDITED UK REVIEW: "Linking the Formal and Informal Economy is an excellent synthesis of past debates and contemporary policy analysis. It embraces economic development, governance and social justice issues and it provides innovative case studies from a wide variety of contexts."—Ray Bromley, State University of New York at Albany

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Product Details

Meet the Author

Basudeb Guha-Khasnobis is, since 2002, a research fellow and project director at UNU-WIDER. Previous appointments include IGIDR (Mumbai), the EXIM Bank of India (Bangalore) ICRIER (New Delhi), and as a research consultant for several international organizations.
Ravi Kanbur is T.H. Lee Professor of World Affairs, International Professor of Applied Economics and Management, and Professor of Economics at Cornell University, and previously Professor of Economics at the University of Warwick, and Chief Economist for Africa at the World Bank.
Elinor Ostrom is Arthur F. Bentley Professor of Political Science at Indiana University. She is also Co-Director, Workshop in Political Theory and Policy Analysis and Co-Director, Center for the Study of Institutions, Population and Environmental Change (CIPEC) at Indiana University. She is a member of the Expert Group on Development Issues of the Swedish Ministry for Foreign Affairs.

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Table of Contents

1. Beyond Formality and Informality, Basudeb Guha-Khasnobis, Ravi Kanbur, and Elinor Ostrom
Concepts and Measurement
2. Bureaucratic Form and the Informal Economy, Keith Hart
3. The Global Path: Soft Law and Non-sovereigns Formalizing the Potency of the Informal Sector, Robert K. Christensen
4. The Relevance of the Concepts of Formality and Informality: A Theoretical Appraisal, Alice Sindzingre
5. Rethinking the Informal Economy: Linkages with the Formal Economy and the Formal Regulatory Environment, Martha Alter Chen
6. Formal and Informal Enterprises: Concept, Definition, and Measurement Issues in India, M. R. Narayana
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. Financial Liberalization in Vietnam: Impact on Loans from Informal, Formal, and Semi-formal Providers, Robert Lensink, Mark McGillivray, and Pham Thi Thu Trà
9. Blocking Human Potential: How Formal Policies Block the Informal Economy in the Maputo Corridor, Fredrik Söderbaum
10. Microinsurance for the Informal Economy Workers in India, Basudeb Guha-Khasnobis and Rajeev Ahuja
11. Turning to Forestry for a Way Out of Poverty: Is Formalizing Property Rights Enough?, Krister Andersson and Diego Pacheco
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
13. Social Capital, Survival Strategies, and their Potential for Post-Conflict Governance in Liberia, Amos Sawyer
14. Enforcement and Compliance in Lima's Street Markets: The Origins and Consequences of Policy Incoherence Toward Informal Traders, Sally Roever
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

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