scholarly journals Informal Sector in India: Migration and Poverty Implications

Author(s):  
Arup Mitra

For assessing the role of urbanization in reducing poverty this paper based on secondary datatries to examine the nature of relationship among urbanisation, migration and informal sector employment. Findings suggest that the informal sector also tends to attract migrants as the probability to get work opportunities in this sector could be high. Further, rural and urban poverty are inter-connected as rural to urban migration and informal sector employment and other state-specific characteristics are associated, though migration and urbanisation with its spill-over effects reduce both rural and urban poverty. Also,based onthe survey data for unincorporated enterprises, the paper examinesif the unorganized or informal manufacturing, trade and services have the potentiality to grow and contribute to the realization of the inclusive growth objective. The inter-sectoral linkages do not necessarily mean that productivity and wages improve in the informal sector if the units manage to receive business contract from the formal sector enterprises. In fact, a large body of the informal sector is seen to be unconnected to the formal sector and this independent segment is on the rise over time. Finally the paper argues for the introduction of an informal sector policy which may help reduce the welfare losses to labour employed at the lower rungs.

Author(s):  
James L. Huffman

Comparison is theme of this chapter, which looks at rural poverty as a way of understanding what was universal and what unique about urban poverty. After a look at the nature-and season-dominated village setting, the work examines daily life: hard work in the rice fields, raising silkworms, the role of women in both fields and homes. A special theme is the importance community played, in setting rules, providing mutual support, and giving children a more productive place than they enjoyed in the hinminkutsu. The pursuit of pleasure also is seen as important in village life: in baths, in relatively open sexuality, and in the constant festivals. A summary shows that villages, the source of most of the urban migration, were at least as poor as city slums but that the rural poverty’s effect was softened by the natural setting and the village sense of community.


Author(s):  
Ahmadou Aly Mbaye ◽  
Nancy Benjamin

This chapter begins with an overview of the major approaches and potential limitations of defining the informal sector, followed by an analysis of its size, structure, and institutional context. It then considers the taxation of informal firms and notes the pervasiveness of tax evasion in the informal sector, along with state failures and informal employment, earnings differentials between formal and informal actors, and the role of rural–urban migration in the rise of informal labor force in developing countries. The chapter explores why informality is so pervasive in Africa; why informal firms are less productive than their formal counterparts; whether it is best for development to proceed in order to get informal firms to register and pay formal taxes; and how to help informal firms and those employed in the informal sector. Finally, it discusses a good approach to development that takes into account the existence of the informal sector.


1999 ◽  
Vol 4 (2) ◽  
pp. 89-99
Author(s):  
Karamat Ali ◽  
Abdul Hamid Abdul Hamid

The informal sector plays a significant role in Pakistan’s economy as well as in other developing countries. The role of the informal sector in solving the unemployment problem of Third World countries has become the focus of a conceptual and empirical debate in recent years. Most of the research takes a favourable view of this sector and suggests that it should be used as a policy instrument for the solution of the most pressing problems of developing countries, such as unemployment, poverty, income inequalities, etc. Before proceeding further, we will define the informal sector and differentiate it from the formal sector. There are various definitions, but the one given in an ILO report (1972) is generally considered the best. According to this report, informal sector activities are ways of doing things characterised by a heterogeneous array of economic activities with relative ease of entry, reliance on indigenous resources; temporary or variable structure and family ownership of enterprises, small scale of operation, labour intensive and adapted technology, skills acquired outside the formal school system, not depending on formal financial institutions for its credit needs; unregulated and unregistered units, and not observing fixed hours/days of operation.


Author(s):  
Hartati Sulistyo Rini

Sebagai sistem ekonomi alternatif, keberadaan sektor informal mengundang pro dan kontra. Peranannya yang signifikan sebagai katup pengaman ekonomi nasional belum diimbangi dengan proteksi atau perlindungan dari pemerintah. Tujuan penelitian ini adalah membahas peran sektor informal dalam mengatasi masalah sosial ekonomi masyarakat dan dilema yang dialami oleh sektor informal dalam menjalankan perannya tersebut. Hasil penelitian ini menunjukkan terdapat peran sektor informal pada bidang ketenagakerjaan dan penyerapan angka pengangguran. Sektor formal dianggap tidak mampu menyediakan kesempatan kerja untuk seluruh lapisan masyarakat, apalagi mereka yang ada pada posisi marjinal. Pada beberapa kasus-khususnya yang berhubungan dengan sektor informal perkotaan perlakuan dan kebijakan negara menjadi sangat diskriminatif karena seringkali berhadapan dengan kebijakan negara yang bahkan berakhir dengan kekerasan.  Perlindungan terhadap sektor informal salah satunya adalah pada pedagang kaki lima di Surakarta.  Kota ini menjadi contoh representatif dalam pengorganisasian kepentingan  pemerintah  dan pedagang kaki lima. Ini dapat menjadi inspirasi positif bagi penanganan sektor informal di tempat yang lain untuk memperluas lapangan kerja bagi masyarakat dan meningkatkan kesejahteraan sosial. As an alternative economic system, the existence of informal sector invites pros and cons. The significant role of informal sector as a safety valve of the national economy has not been matched by government with the protection or support The objective of this study is to discuss the role of the informal sector in addressing social and economic issues, and the dilemma faced by the informal sector in carrying out this role. The results of this study shows that there is an important role of the informal sector in the field of employment and unemployment absorption. The formal sector is not considered able to provide job opportunities to all levels of society, especially those in marginal positions. In some cases, particularly with regard to the urban informal sector-treatment and state policy became very discriminatory because often faced with state policies and even lead to violence. The protection of the informal sector one is on street vendors in Surakarta. The city is become representative example in organizing between the government’s interest and street vendors. It can be a positive inspiration for handling informal sector in other places to expand employment opportunities for the community and increase social welfare.


2008 ◽  
Vol 9 (17) ◽  
pp. 73-105 ◽  
Author(s):  
Emmanuel Alvarado

This article analyzes the progress obtained in diminishing poverty and inequality in Mexico during the post-NAFTA years ranging from 1994 to 2007, and how it pertains to the broad critical debate surrounding poverty-gap reduction in the context of regional and international economic integration and trade liberalization. Specifically, the article discusses the evolution of Mexican rural and urban poverty, income and regional disparities, as well as the role of government spending after the enactment of NAFTA and within the framework of economic liberalization marked by expanded international trade and investment, particularly with the United States.


Author(s):  
Arup Mitra

In relation to urbanization, findings suggest that the unemployment rate after migration tends to decline. States with higher urbanization levels reveal a larger increase in regular wage employment after migration. With an increase in city size, the migration rate rises mainly because employment prospects are better in large cities due to agglomeration effects. Migration, urban informal sector employment, and the proportion of the Scheduled Caste population in urban and rural areas are all positively associated, suggesting that the socially backward groups are more likely to migrate from rural areas and get absorbed in the urban informal sector. This pattern is accompanied by a decline in the incidence of poverty in both rural and urban areas: even the urban informal sector activities are able to provide relatively better job opportunities and higher living standards.


2019 ◽  
Vol 129 (621) ◽  
pp. 1971-1991 ◽  
Author(s):  
Tiago Cavalcanti ◽  
Daniel Da Mata ◽  
Marcelo Santos

Abstract We construct a simple model of a city with heterogeneous agents and housing choice to explain the determinants of slums, home to about one-third of the urban population in developing countries. The model supports the main empirical evidence regarding slum formation and is able quantitatively to assess the role of each determinant of slum growth. We show that urban poverty, inequality and rural–urban migration explain much of the variation in slum growth in Brazil from 1980 to 2000. Ex ante evaluation of the impacts of policy interventions shows that removing barriers to formalisation has a strong impact on slum reduction.


2017 ◽  
Vol 22 (02) ◽  
pp. 1750008
Author(s):  
PROSPER SENYO KOTO

Is social capital important in formal-informal sector linkages? Previous research focused on the role of the productive capacities of the enterprises in the informal sector as determining factors. This paper aims to uncover, at least in part, whether or not social capital is important in facilitating the linkages between enterprises in the formal and informal sectors. As a novelty, having linkages with the formal sector is treated as a rare event. Consequently, the analysis involves flexible binary generalized extreme value models using data from the World Bank Informal Sector Surveys. The scope is thirteen countries from sub-Saharan Africa. The results are indicative that social capital has significantly positive, real effects on the likelihood of linkages. If one sees the informal sector as a source of jobs and as a stepping-stone to the formal sector, there is a case for the recognition of the role of informal social networks in the design of entrepreneurial policy.


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