scholarly journals How close are formal and informal work?

2017 ◽  
Vol 37 (7/8) ◽  
pp. 374-386 ◽  
Author(s):  
Joanna Shapland ◽  
Jason Heyes
Keyword(s):  
Informal Economy ◽  
Government Regulation ◽  
Working Environment ◽  
Informal Work ◽  
Content Type ◽  
Formal Economy ◽  
Informal Economies ◽  
Formal Employment ◽  
The Uk ◽  
Government Statistics

Purpose Recent changes in the UK to the regulation and modes of work in the formal and informal economies are considered. Research in this field has tended to remain in silos (treating formal economy working conditions separately from research on the informal economy). The question is whether the means of work and benefits to the worker for formal and informal work are now as different as the former images of formal and informal economy work imply under a “jobs-for-life” economy. The purpose of this paper is to consider whether the current aim of government regulation of the informal economy – to formalise it – is actually of benefit to workers, as might be supposed. Design/methodology/approach This paper considers recent research findings on the formal and informal economy, using official government statistics for the UK and more detailed European studies on the informal economy. Findings This paper argues that formal employment in the UK is becoming more casualised, with less associated benefits to employees. Though it is still of benefit to the state to formalise informal work (to increase tax take), some of the links between formalisation and a good working environment for workers are being broken, which may lead to the informal economy becoming more popular and requiring different priorities in its regulation. Originality/value This paper argues that we need to change our assumptions and image of work in the formal economy, compared to that in the informal economy.

When informality meets formality: evidence from China

2018 ◽  
Vol 12 (1) ◽  
pp. 184-201 ◽  
Author(s):  
Kun (Michelle) Yang ◽  
Michael J. Pisani
Keyword(s):  
Informal Economy ◽  
Institutional Environment ◽  
Geographical Location ◽  
Business Environment ◽  
Cross Sectional Survey ◽  
Cross Sectional ◽  
Content Type ◽  
Formal Economy ◽  
Structural Inertia ◽  
The Impact

Purpose This study aims to explore “what impact does competition from informal enterprises have on formal firms” within the Chinese economic and business environment. Design/methodology/approach The paper opted for an exploratory study utilizing the cross-sectional survey data “2012 China Enterprise Survey” conducted by the World Bank. The survey is composed of approximately 200 business-related questions across the spectrum of business operations. In all, 2,700 privately owned Chinese firms are included in the logistic regression analysis. Findings Results show the impact of informal firm competition upon formal firms in China are influenced by geographical location, industry sector, ownership profile, governmental ownership, online presence and the extent of obeying labor regulations or the time spent in handling the governmental regulatory environment. There is a competitive and complementary simultaneous intertwined relationship between formal and informal economy. It occurs in a formal economy not fully divorced from the structural inertia of the planned economy as it transitions to a market-based economy. Practical implications This paper extended the assumption of institutional theory and presented it as a dynamic view of the evolution of organizations. It contributes by offering a simultaneous dual relationship between the formal and informal economy. It also adds one more potential feature of populations in the population ecology theory. Originality/value This exploratory paper empirically examines the impacts of informal sector enterprises on formal sectors firms in China and proposes a dual force effect of the informal economy to the formal economy given the current Chinese institutional environment. The study also provides a platform for further research on the interactions between the formal and informal sectors in emerging markets.

Long-term unemployment

2020 ◽  
Vol 47 (4) ◽  
pp. 713-727
Author(s):  
Emmanuel Apergis ◽  
Nicholas Apergis
Keyword(s):  
Working Environment ◽  
Employment Relations ◽  
Content Type ◽  
Different Types ◽  
The Uk ◽  
First Time ◽  
Robustness Check ◽  
Modelling Approach

PurposeThis paper empirically explores the role of skill losses during unemployment behind firms' behaviour in interviewing long-term unemployedDesign/methodology/approachThe analysis makes use of the Work Employment Relations Survey in the UK, while it applies a panel probit modelling approach to estimate the empirical findings.FindingsThe findings document that skill losses during long-term unemployment reduce the likelihood of an interview, while they emphasize the need for certain policies that could compensate for this deterioration of skills. For robustness check, the estimation strategy survives the examination of the same predictors under different types of the working environment.Originality/valueThe original values of the work 1 combines for the first time both duration and technology as predictors of interview probability. Until now, the independent variables were used to test whether an individual has managed to exit unemployment, thus skipping the step of the interview process.

Retailer-reseller embeddedness and price-setting in the informal economy

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Uchenna Uzo
Keyword(s):  
Informal Economy ◽  
Design Methodology ◽  
Product Category ◽  
Pricing Strategy ◽  
Unique Contribution ◽  
Price Setting ◽  
Content Type ◽  
Informal Economies ◽  
Relational Embeddedness ◽  
Business To Business

Purpose This study aims to investigate how and why retailers and resellers in sample firms of the informal economy set prices and the performance implications for the firm’s pricing efforts. Design/methodology/approach The author generated their insights through an inductive qualitative study of four organizations operating within the informal economy in the Nigerian retailing sector. Findings The study found that some organizations within the informal economy set prices in different ways i.e. negotiated pricing and fixed pricing. The contracting criteria between the retailers and resellers determine the pricing strategy. Contractual terms based on relational ties between both facilitate negotiated price-setting, while contractual terms based on non-relational ties promote fixed pricing. The type of price-setting arrangement of the sampled retailer relates to the organization’s performance within its industry. Particularly, the study found that retailers that adopted negotiated pricing performed above the industry average for their product category. In contrast, the retailers that adopted fixed pricing performed below the industry average for their product category. Originality/value As far as the author knows, this is the first study to investigate pricing methods within the informal economy. This is also the first known study to investigate price-setting arrangements between retailers and resellers within the informal economy. Another unique contribution of this paper is that it is the first study that focuses on pricing interactions among business-to-business firms within the informal economy. The study contributes to the work on relational embeddedness, relational contracting and informal economies.

scholarly journals Low Wages and No Dignity: Russian Workers Reflect on the Stark Post-Soviet Choices in Blue-Collar Employment

2013 ◽  
Vol 84 ◽  
pp. 271-277 ◽  
Author(s):  
Jeremy Morris
Keyword(s):  
Informal Economy ◽  
Blue Collar ◽  
Blue Collar Workers ◽  
Formal Economy ◽  
Formal Employment ◽  
Traditional Production ◽  
Set Up ◽  
Production Industry ◽  
Low Wages

AbstractThis Tale from the Field focuses on the interpretation by workers of the precarious nature of blue-collar formal employment in Russia. In an ethnographic sketch based on over two years in the field, I follow an individual, Sergei, as he relies more and more on informal and other sources of income instead of waged labour in the increasing number of multi-national enterprises which have come to Russia to set up factories. Why does Sergei, and many like him, still young or without memory of Soviet labour practices, ‘choose’ exit from the formal economy at the very moment when wages and conditions are finally increasing? Why is the informal economy as a ‘choice’ so important to blue-collar workers despite the hunger for labour in traditional production industry?

Informal Economies

2021 ◽  
Author(s):  
Ernest Aryeetey
Keyword(s):  
Informal Sector ◽  
Informal Economy ◽  
Poverty Reduction ◽  
New Technologies ◽  
Informal Employment ◽  
Policy Response ◽  
Economic Activities ◽  
Formal Economy ◽  
The Future ◽  
Informal Economies

The expressions, “informal economy,” “informal sector,” and “informal employment” reflect statistical terms and definitions used to describe various aspects of informality. They are the result of several decades of work to develop a framework that adequately represents the multifaceted nature of informality as it applies not only to developing countries, but also to other transition and developed economies. The informal sector is generally viewed as the set of activities of small unregistered enterprises, while informal employment refers to employment within the formal or informal sector that lacks any form of protection, whether legal or social.1 The informal economy is a broader concept that encompasses all of these elements in their different forms, including their outputs and outcomes. The many different views about the drivers and composition of the informal economy in Africa have influenced various prescriptions and policy responses. On the one hand, some have viewed informality as being inimical to investment and growth, given that the activities undertaken usually fall outside of official regulation and control. The policy response has, therefore, often been to clamp down on or formalize the activities and relationships within the informal economy. On the other hand, informality is sometimes viewed as critical for growth and poverty reduction, given that the informal economy is inextricably linked to the formal economy while also serving as an important source of livelihood for millions of people. As a result of this, some effort has recently gone into providing a more supportive environment to enhance productivity within the informal economy and minimize its inherent vulnerabilities in the last decade. In the face of increasing globalization and access to new technologies that will drive the future of work, there is concern about the future of informal economic activities. Whether new technologies lead to a decline or upscaling of the informal economy in Africa will depend on several elements. Technology will not only shape how informality in Africa is viewed, but will influence the kind of activities undertaken, its links with the formal economy, and ultimately, the public policy response, which will itself be shaped by advances in technology.

The problematic differentiation between property bonds and leases in healthcare provision

2015 ◽  
Vol 33 (1) ◽  
pp. 83-94 ◽  
Author(s):  
Andrew Ellison ◽  
Graham Squires ◽  
Patrick Dempsey
Keyword(s):  
Government Regulation ◽  
Property Market ◽  
Structured Interviews ◽  
Healthcare Provision ◽  
Institutional Investment ◽  
Content Type ◽  
Original Insight ◽  
The Uk ◽  
New Instruments ◽  
Insight Into

Purpose – There are some 487,000 places in long-stay residential care and nursing homes in the UK representing an industry worth some £15.2 billion per annum. Creating leases with guaranteed rental uplifts, a property bond in all but name, now attracts significant investment into healthcare. This is argued to be unsustainable, as evidenced by the collapse of Southern Cross Healthcare. The purpose of this paper is to provide insight into institutional investment for sustainable healthcare provision. Design/methodology/approach – It is carried out via a range of unstructured and semi-structured interviews with a purposive sample of a small elite of professionals involved at the summit of this investment market and analysis of secondary literature concerning the wider international property market regarding the way in which advisers and investors view the security and value of these new instruments. Findings – It is found that the differentiation between rental growth and indexed rental uplifts reveal a misunderstanding of the nature of the investment vehicles currently being marketed. Practical implications – The implication of the research, is that much modern private healthcare provision is financially unsustainable, as has begun to be recognised in recent government regulation and guidance. Originality/value – This research provides new and original insight into institutional investment for sustainable healthcare provision

Business models sustaining subsistence economies: evidence from India

2017 ◽  
Vol 12 (3) ◽  
pp. 302-316 ◽  
Author(s):  
Bhavani Shankar Saripalli ◽  
Vinaysingh Chawan
Keyword(s):  
Conceptual Framework ◽  
Business Model ◽  
Informal Economy ◽  
Customer Value ◽  
Business Models ◽  
Content Type ◽  
Organisational Form ◽  
Subsistence Economies ◽  
Formal Economy ◽  
Long Run

Purpose The purpose of this paper is to analyse interventions of various forms of organisations operating with the objective of connecting subsistence entrepreneurs (SEs) with the formal economy. This work also attempts to understand and analyse the transformational role played by these organisations. Finally, the paper aims to arrive at a conceptual framework for organisations interested in playing a transformational role. Design/methodology/approach The paper deals with subsistence entrepreneurship and business models for subsistence economies. It draws from case studies of six organisations operating with the objective to connect subsistence entrepreneurs with formal economy. Each case chosen is unique with respect to the organisational form it takes to achieve the objective. However, a lot of similarity can be seen in the components of the business model adopted by these organisations. Findings Organisations which emerge keeping the context of rural producers in mind survive and support SEs in the long run. SEs need not always get converted into transformational entrepreneurs. However, with the help of organisations which collectivise SEs, they can interact with formal economy. Such organisations help large numbers of SEs to sustain and possibly move out of subsistence status over a period of time. These organisations have to fill the voids left by government or market institutions so as to create enabling conditions for SEs to thrive. Despite the efforts of the organisations, it is not possible for all SEs to move out of their subsistence status and existence in informal markets. However, it is possible in case of some SEs at least, as the institutional support gives them more certainty in incomes. Research limitations/ implications The paper does not take a business model adopted by government institution for the purpose of analysis. Practical implications The paper offers practical suggestions for organisations interested in collectivising SEs with the aim to improve their returns from market transactions. Originality/value The paper offers a conceptual framework to enrich the understanding of role played by organisations working towards collectivising SEs. It adds to the debate of subsistence entrepreneurship and transformational entrepreneurship. It elaborates the elements of social capital created by these organisations at the meso level. Finally, it re-emphasises the strengths of informal economy to support the customer value proposition for formal markets.

Corporate governance: on the crossroads of meta-regulation and social responsibility

2020 ◽  
Vol 27 (3) ◽  
pp. 801-820
Author(s):  
Tareq Na'el Al-Tawil ◽  
Hassan Younies
Keyword(s):  
Corporate Governance ◽  
Social Responsibility ◽  
Moral Agency ◽  
Government Regulation ◽  
Self Regulation ◽  
Content Type ◽  
Positive Attitudes ◽  
The Usa ◽  
Stakeholder Model ◽  
The Uk

Purpose The purpose of this paper is to discuss incongruities in the corporate entity over the matter of agency. In lieu of the traditional notion of moral agency theory, the stakeholder model offers congruent grounding to corporate governance. Socially irresponsible or unethical corporate activities are perceived to increase expenses, diminish shareholder value and tarnish business reputations. In contrast, socially responsible corporate practices contribute to positive attitudes to the company and contribute to the creation of competitive advantage. Design/methodology/approach This paper follows the ongoing evolution of the regulatory changes instituted after the scandalous corporate fiascos of the present century, such as those of Enron and WorldCom in the USA, Polly Peck in the UK, HIH Insurance and One.Tel in Australia, and Siemens in Germany, inter alia. The exposition also touches on the regulatory metamorphosis of corporate governance in its convergence towards “meta-regulation” with corporate social responsibility at the core. Findings While meta-regulation has so far worked in many countries, caution is expressed over the perils of over-reliance on a meta-regulatory approach. Industries or market sectors should also attempt to operate from the start within the confines of self-regulation and government regulation. Market sectors and industries need to find the framework of regulation that is best suited to their operations. Originality/value The paper concludes by discussing the observed challenges and implications of such convergence, as well as future directions for law practitioners, academics and researchers in the realm of corporate conduct.

scholarly journals Explaining participation in the informal economy: a purchaser perspective

2017 ◽  
Vol 44 (11) ◽  
pp. 1421-1436 ◽  
Author(s):  
Colin C. Williams ◽  
Ioana Alexandra Horodnic ◽  
Jan Windebank
Keyword(s):  
Informal Economy ◽  
Cost Benefit ◽  
Lower Price ◽  
Content Type ◽  
Face To Face ◽  
Goods And Services ◽  
Formal Economy ◽  
Theoretical Perspectives ◽  
Policy Measures ◽  
The Cost

Purpose Participation in the informal economy has been predominantly explained from a supply side perspective by evaluating the rationales for people working in this sphere. Recognising that many transactions in the informal economy are often instigated by customers, exemplified by purchasers asking “how much for cash?”, the purpose of this paper is to explain the informal economy from a demand-side perspective by evaluating citizens’ rationales for making purchases in the informal economy. Here, the authors test three potential explanations for acquiring goods and services in the informal economy, grounded in rational economic actor, social actor and formal economy imperfections theoretical perspectives. Design/methodology/approach To do this, a 2013 Eurobarometer survey, involving 27,563 face-to-face interviews conducted in 28 European Union member states is reported. Findings The finding is that all three rationales apply but the weight given to each varies across populations. A multinomial logit regression analysis then pinpoints the specific groups variously using the informal economy to obtain a lower price, for social or redistributive rationales, or due to the failures of the formal economy in terms of the availability, speed and quality of provision. Practical implications The outcome is to reveal that the conventional policy approach of changing the cost/benefit ratios confronting purchasers will only be effective for those purchasers citing a lower price as their prime rationale. Different policy measures will be required for those making informal economy purchases due to the shortcomings of the formal economy, and for social ends. These policy measures are then discussed. Originality/value The value and originality of this paper is that it explains participation in the informal economy from a purchaser, rather than the predominant supplier, perspective.

scholarly journals An institutional theory of the informal economy: some lessons from the United Kingdom

2016 ◽  
Vol 43 (7) ◽  
pp. 722-738 ◽  
Author(s):  
Colin C Williams ◽  
Ioana Alexandra Horodnic
Keyword(s):  
Informal Economy ◽  
Rural Areas ◽  
Urban Areas ◽  
Age Groups ◽  
Formal Institutions ◽  
Tax Morale ◽  
Content Type ◽  
Values And Beliefs ◽  
The Asymmetry ◽  
The Uk

Purpose – The purpose of this paper is to propose a new way of explaining participation in the informal economy as resulting from the asymmetry between the codified laws and regulations of a society’s formal institutions (government morality) and the norms, values and beliefs of the population that constitute its informal institutions (societal morality). The proposition is that the greater the asymmetry between government morality and societal morality, the greater is the propensity to participate in the informal economy. Design/methodology/approach – To evaluate this institutional asymmetry theory, the results are reported of 1,306 face-to-face interviews conducted during 2013 in the UK. Findings – The finding is a strong correlation between the degree of institutional asymmetry (measured by tax morale) and participation in the informal economy. The lower the tax morale, the greater is the propensity to participate in the informal economy. Using ordered logistic regression analysis, tax morale is not found to significantly vary by, for example, social class, employment status or wealth, but there are significant gender, age and spatial variations with men, younger age groups, rural areas and Scotland displaying significantly lower tax morale than women, older people, urban areas and London. Practical implications – Rather than continue with the current disincentives policy approach, a new policy approach that reduces the asymmetry between government morality and societal morality is advocated. This requires not only changes in societal morality regarding the acceptability of participating in the informal economy but also changes in how formal institutions operate in order for this to be achieved. Originality/value – This paper provides a new way of explaining participation in the informal economy and reviews its consequences for understanding and tackling the informal economy in the UK.

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