Linking the Formal and Informal Economy: Concepts and Policies:Elinor Ostrom

The concepts of formal and informal remain central to the theory and practice of development more than half a century after they were introduced into the debate. They help structure the way that statistical services collect data on the economies of developing countries, the development of theoretical and empirical analysis, and, most important, the formulation and implementation of policy.

This volume brings together a significant new collection of studies on formality and informality in developing countries. The volume is multidisciplinary in nature, with contributions from anthropologists, economists, sociologists, and political scientists. It contains contributions from among the very best analysts in development studies.

Between them the chapters argue for moving beyond the formal-informal dichotomy. Useful as it has proven to be, a more nuanced approach is needed in light of conceptual and empirical advances, and in light of the policy failures brought about by a characterization of the 'informal' as 'disorganized'. The wealth of empirical information in these studies, and in the literature more widely, can be used to develop guiding principles for intervention that are based on ground level reality.

Readership: Researchers, Policy-makers and policy analysts, and graduate students interested in development studies and development economics.


Edited by Basudeb Guha-Khasnobis, UNU-WIDER, Ravi Kanbur, Cornell University, and Elinor Ostrom, Indiana University

Contributors:
Rajeev Ahuja, Indian Council for Research on International Economic Relations
Krister Andersson, Indiana University
Martha Alter Chen, Harvard University
Robert K. Christensen, Indiana University
Basudeb Guha-Khasnobis, UNU-WIDER
Keith Hart, Goldsmiths College, University of London
Ravi Kanbur, Cornell University
Robert Lensink, University of Groningen
Norman V. Loayza, The World Bank
Mark McGillivray, UNU-WIDER
M. R. Narayana, Institute for Social and Economic Change
Jeffrey B. Nugent, University of Southern California
Elinor Ostrom, Indiana University
Ana María Oviedo, University of Maryland
Diego Pacheco, Indiana University
Sally Roever, University of California, Berkeley
Amos Sawyer, Indiana University
Luis Servén, The World Bank
Alice Sindzingre, Centre National de la Recherche Scientifique, Paris
Fredrik Söderbaum, Göteborg University
Shailender Swaminathan, University of Alabama
Pham Thi Thu Trà Pham, University of Groningen
Liz Alden Wily, Independent Land Tenure and National Resources Management Adviser

1: Basudeb Guha-Khasnobis, Ravi Kanbur, and Elinor Ostrom: Beyond Formality and Informality
Concepts and Measurement
2: Keith Hart: Bureaucratic Form and the Informal Economy
3: Robert K. Christensen: The Global Path: Soft Law and Non-sovereigns Formalizing the Potency of the Informal Sector
4: Alice Sindzingre: The Relevance of the Concepts of Formality and Informality: A Theoretical Appraisal
5: Martha Alter Chen: Rethinking the Informal Economy: Linkages with the Formal Economy and the Formal Regulatory Environment
6: M. R. Narayana: Formal and Informal Enterprises: Concept, Definition, and Measurement Issues in India
Empirical Studies of Policies and Interlinking
7: Norman V. Loayza, Ana María Oviedo, and Luis Servén: The Impact of Regulation on Growth and Informality: Cross-Country Evidence
8: Robert Lensink, Mark McGillivray, and Pham Thi Thu Trà: Financial Liberalization in Vietnam: Impact on Loans from Informal, Formal, and Semi-formal Providers
9: Fredrik Söderbaum: Blocking Human Potential: How Formal Policies Block the Informal Economy in the Maputo Corridor
10: Basudeb Guha-Khasnobis and Rajeev Ahuja: Microinsurance for the Informal Economy Workers in India
11: Krister Andersson and Diego Pacheco: Turning to Forestry for a Way Out of Poverty: Is Formalizing Property Rights Enough?
12: Jeffrey B. Nugent and Shailender Swaminathan: Voluntary Contributions to Informal Activities Producing Public Goods: Can These be Induced by Government and other Formal Sector Agents? Some Evidence from Indonesian Posyandus
13: Amos Sawyer: Social Capital, Survival Strategies, and their Potential for Post-Conflict Governance in Liberia
14: Sally Roever: Enforcement and Compliance in Lima's Street Markets: The Origins and Consequences of Policy Incoherence Toward Informal Traders
15: Liz Alden Wily: Formalizing the Informal: Is There a Way to Safely Unlock Human Potential Through Land Entitlement? A Review of Changing Land Administration in Africa

"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.
Publisher:
Oxford University Press
Series:
UNU-WIDER Studies in Development Economics
Title:
Linking the Formal and Informal Economy: Concepts and Policies
Authors:
Edited by Basudeb Guha-Khasnobis, Ravi Kanbur, and Elinor Ostrom
Publication date:
September 2006
ISBN Printed:
199204764
ISBN 13 Print:
9780199204762
Copyright holder:
© UNU-WIDER
Copyright year:
2006
Keywords:
multidisciplinary, anthropologists, economists, sociologists, political scientists, new empirical research, formal, informal sectors, developing economies
JEL:
E26, O17, P37
Project:
Unlocking Human Potential Conference
Format:
hardback book

An OUP India edition was published in February 2007, and the Oxford paperback version was published in October 2007.