The Urban Informal Economy Revisited

Call for Manuscripts for Thematic Issue on
The Urban Informal Economy Revisited
Issue editors: Ray Bromley and Tamar Diana Wilson

The urban informal economy has been booming in Latin America.  Although criteria for measuring informality vary among countries and organizations (ILO, CEPAL, etc.) making camparisons somewhat inexact, data from 2005 showed that more than 50% of workers in Latin America were employed in the informal economy, with a high of 71 percent in Bolivia and between 40 and 44 percent in Brazil, Costa Rica, Mexico, Panama and Uruguay.  Overall, the informal economy continues to constitute about 50% of employment in Latin America.  By 2012 informal employment had grown faster that formal employment in some countries in the region, such as Ecuador and Mexico.

In the past decade or so it has been widely recognized that the informal economy is composed of at least two subsectors: informal waged work and self-employment.  Informal waged work may be related to subcontracting chains emanating from national or multinational corporations or may appear in more independent workshops. Formal firms increasingly outsource part of their production through temporary, contract, or part-time employment. Homeworkers may be seen as disguised wage-workers for these corporations and smaller companies.  In some cases companies purposely informalize at least some of their workers to by-pass trade unions and to avoid paying benefits such as medical care, pensions and the minimum wage. Informal self-employment may range from accountants and computer technicians to maids, gardeners, carpenters, mechanics, and street vendors. Both informal salaried workers and the self-employed may be in some respects “semi-informal” when some extant labor and taxation laws are observed while others are not.  Informal activity and deliberate avoidance of rules are not confined to lower-income groups or to petty capitalism, but may be practiced by elites, officials and major corporations under both capitalist and socialist systems.

The informal economy has been envisioned as a dynamic sector by some analysts and by others as a last resort or refuge for those seeking survival by any means possible.  Given the heterogeneity of the informal economy, both of these insights have some truth.  Nonetheless, the informal economy overwhelmingly represents a subsidy to the formal economy, facilitating the growth of socio-economic inequalities.  This is true even of street vendors who often retail goods produced by core capitalist (or state-owned) firms.

A World Bank publication suggests that there are two different dynamics in the Latin American urban informal economy.  Some, particularly informal salaried workers, are marginalized, for a variety of reasons, from finding employment in the formal economy.  The informal salaried are defined as those who are not afforded the labor protections and benefits legislated for those in the formal economy.  It is argued that those who occupy this subsector of the informal economy are youth without experience and those who are low on the human capital ladder in terms of skills or education.  Others, particularly the self-employed, may choose informality due to values placed on autonomous work and other “nonpecuniary” motives.

This issue seeks to delve more deeply into the dynamics of informality and answer important theoretical and emprical questions about its contemporary characteristics and consequences.  How and why does it differ from the informal economy of two or three decades ago?  How and why does it vary from country to country or within countries?  How is informality related to broader national and international trends, for example in education, migration and globalized production?  What impact have cellphones, the internet and other new technologies had on informal activity?  Does informal waged work differ according to the size and national origin of the employer? How does informality vary by gender, race/ethnicity, or other demographic variables and with what consequences?  How is informality related to poverty, wealth and inequality?  Are there significant differences between informality in more and less neoliberal economies?  How do the economic models of the continent’s leftist governments deal with informality?  How do workers in the informal economy act politically or why do they fail to act?  How do political parties and social movements relate to the informal sector?

We seek articles that address informality broadly not only as an economic phenomenon but as one with political, social and cultural dimensions.  Empirical studies should have a strong theoretical framing.  Submissions are invited on any relevant topic, which could include but are not limited to the following:

  • Whether the World Bank distinction between those who are excluded from the formal economy and those who voluntarily exit from it seems valid in any particular Latin American country, and if so, what factors are at work. For example how do public policies and regulations contribute to expansion or contraction of the informal economy and what are the primary political-economic forces influencing these policies and regulations ?
  • Whether and how the worldwide economic recession affected either or both subsectors of the informal economy. Can the informal economy be seen as pro-cyclical, expanding with economic growth, or counter-cyclical, expanding with the drying up of formal employment? Does this differ according to subsector or occupation within a sector or to the size or origin (national or transnational) of the employer?
  • How and why does foreign direct investment affect the informal sector? Do transnational corporations engage in purposeful informalization and if so, what is the relative importance of economic and political objectives?  Are there incentives to prefer subcontracted over direct employment?
  • Whether free trade agreements in Latin America have led to greater or lesser informalization of waged work and whether this varies by economic sector. How is this related to the politics of free trade agreements?  What conflicts among national and transnational corporations, international financial organizations, national governments, labor organizations, etc. are reflected in the provisions of trade agreements most relevant to the informal economy?
  • How informal economic activity impacts or may provide or support alternative solutions to “social issues” such as housing, education, child care, elder care, personal security, community development, and the protection of private property.
  • What part cross-border migrants (e.g. Colombians in Venezuela, Bolivians in Brazil, Nicaraguans in Costa Rica) play in the informal economy of the destination countries. How do the vulnerabilities of undocumented foreign workers affect the politics of informality?
  • Whether nodal cities of capitalist accumulation display higher or lower degrees of informalization than secondary cities. Is this consistent throughout Latin America, or how and why does it vary by country or region?
  • What explains the growth of the informal economy in socialist countries such as Cuba? What are the primary similarities and differences in informality in Cuba as opposed to in capitalist economies?  How is informality related to the other economic changes currently underway in Cuba?
  • What are the roles of peasants, women, and/or indigenous peoples in the subsectors of the urban informal economy? Has their presence increased after the signing of free trade agreements such as NAFTA or CAFTA and/or since the economic recession?  Why would this be so?
  • Are conditional cash transfers, where they exist, essentially subsidizing capitalist firms through partially supporting their informalized labor force? What are the political dynamics behind these cash transfers? Are they meant to mute protest by those who are excluded from the formal economy?
  • What is the political significance of the urban informal sector? Do popular political movements seeks to incorporate informal sectors and on the basis of what kinds of appeals and demands? How does the informal sector interact with organized labor movements?  How do informal workers participate in other movements of the urban poor for housing, health care, education, etc.?
  • How do government policies toward the urban informal sector form part of their broader political agenda, whether noeliberal or anti-neoliberal?

SUBMITTING MANUSCRIPTS

Please feel free to contact the Issue Editors with questions pertaining to the issue but

be sure that manuscripts are sent to the LAP office by e-mail to:

lap@ucr.edu with the subject line – “Your name – MS for Informal Economy issue

To avoid duplication of content, please contact the issue editors to let them know of your interest in submitting and your proposed topic.  We encourage submission as soon as possible but this call will remain open as long as it is posted on the LAP web site.

Manuscripts should be no longer than 8,000 words of paginated, double-spaced 12 point text, including notes and references. The manuscript should include an abstract of no more than 100 words and 5 key words. Include a separate cover sheet with author identification, basic biographical and contact information, including e-mail and postal addresses. Please follow the LAP style guide which is available at www.latinamericanperspectives.com under the “Calls for Manuscripts” tab where the manuscript review process is also described.   Manuscripts should be consistent with the LAP Mission Statement which is found under the “About” tab.

Manuscripts may be submitted in English, Spanish, or Portuguese  If you do not write in English with near native fluency, please submit in your first language. LAP will translate accepted manuscripts submitted in Spanish and Portuguese.If submitting in Spanish or Portuguese, please indicate if you will have difficulty reading correspondence from the LAP office in English.

All manuscripts should be original work that has not been published in English and that is not being submitted to or considered for publication in English elsewhere in identical or similar form.

Issue editors contact info:    Tamar Diana Wilson <tamardiana@yahoo.com>

Ray Bromley <rbromley@albany.edu>