Conceptualising Informality: Regulation and Enforcement
By Ravi Kanbur. Social Science Research Network, 2009
176 citations recorded by the source corpus.
The informality discourse is large and vibrant, and is expanding rapidly. But there is a certain conceptual incoherence to the literature. New definitions of informality compete with old definitions leading to a plethora of alternative conceptualisations. While some individual studies may apply a tight definition consistently, the literature as a whole is in a mess. This article proposes that informality and formality should be seen in direct relation to economic activity in the presence of specified regulation(s). Relative to the regulation(s), four conceptual categories that can help frame the analysis are: (A) regulation applicable and compliant, (B) regulation applicable and non-compliant, (C) regulation non-applicable after adjustment of activity, and (D) regulation non-applicable to the activity. Rather than use thegeneric labels ‘informal’ and ‘formal’, it would be preferable if the analysis focused on thesefour categories (or even more disaggregated as appropriate). A central determining factor in the impacts of regulation on economic activity across these four categories is the nature and intensity of enforcement. While lack of enforcement is well-documented, an understanding of its determinants − why and to what extent a government would not enforce a regulation that it has itself passed, and why non-enforcement varies from one context to another, is relatively neglected in the literature. Thus, specificity on regulation and on enforcement is the key to achieving conceptual clarity in the analytical literature and in the policy discourse on informality. [IZA Discussion Paper 4186]
Subfields: Economics and Econometrics
View Paper: https://www.semanticscholar.org/paper/c5544d1584ccb1f9e7c2874b9533896670115360
How researchers see this paper
The researchers whose trusted networks rank it highest, strongest advocate first. Every researcher gets a different order.
In Economics and Econometrics
Citations in the corpus
- Women ’ s economic empowerment and inclusive growth : labour markets and enterprise development (2012, background): “As noted earlier, many governments do not enforce their own laws, and labour laws are among the ones most widely violated (Kanbur, 2009).”
- Determinants of the Level of Informality of Informal Micro-Enterprises: Some Evidence from the City of Lahore, Pakistan (2016, background): “…of informality in that they conform to the formal rules and regulations in some regards but not others (Andrade et al 2013; Bruhn & McKenzie 2013; Kanbur 2009; Ram et al 2002a,b; Small Business Council 2004; Verreyne et al 2014; de Villiers Scheepers et al 2014; Williams 2006; Williams &…”
- (In)Formal and (Un)Productive: The Productivity Costs of Excessive Informality in Mexico (2012, methodology): “Following Kanbur (2009), we define formality with reference to the observance of 11 There can be large firms with non-salaried contracts: some firms in Mexico engaging in individual sales at home rather than at the store have thousands of workers.”