Informal employment in developed and developing economies: Perspectives and policy responses

Abstract

The aim of this introductory article is to provide a critical overview of how informality has been defined and measured, together with selected findings on its extent and character, and a summary of competing views regarding its role in contemporary economies and how it can be tackled. The outcome is a set of conceptual frameworks for understanding both the burgeoning literature on informal employment and how each of the perspectives presented in this Special Issue contributes to the advancement of knowledge on this subject so as to set the scene for the articles that follow.

Tackling informal employment in developing and transition economies: a critical evaluation of the neo-liberal approach

“…Over the past few decades, a shift has taken place away from eradicating informal employment and towards facilitating its formalisation as it has been recognised that the intention in tackling informal employment is to address the growth of the formal economy, decent work, fuller employment and increasing tax revenue to support wider societal objectives (Chen, 2012;Williams and Lansky, 2013). To achieve this, the vast majority of the policy debate has revolved around whether targeted repressive measures and/or targeted incentives are most effective at facilitating formalisation (Dibben and Williams, 2012;Eurofound, 2013;Feld and Larsen, 2012;OECD, 2012;Williams and Lansky, 2013;Williams and Nadin, 2012a, 2012b. This paper, however and in contrast to this conventional policy debate, reveals that broader economic and social policy measures are also important.…”

Explaining Cross-national Variations in the Size of the Shadow Economy in Central and Eastern Europe

“…Over the past decade or so, a policy shift has taken place away from seeking to eradicate the shadow economy and towards a desire to facilitate its formalization as it has been recognized that the broader intention in tackling the shadow economy is to promote economic growth, decent work, fuller employment and bolster tax revenue to support wider societal objectives (Chen 2012;ILO 2013b;Williams and Lansky 2013). To achieve this formalization of the shadow economy, a policy debate has ensued around whether to use repressive measures and/or incentives (Dibben and Williams 2012;Eurofound 2013;Feld and Larsen 2012;ILO 2013b;OECD 2012;.…”

Unacceptable forms of work: A multidimensional model

“…By excluding the formal sector, for example, the enterprise-centred definition misses forms of informal employment, such as zero-hours contracts or bogus selfemployment, that are not confined to the informal sector (ILO 2012b, p 20). Nor does this definition capture work within private households or subsistence activities such as farming and fishing (Williams and Lansky 2013).…”

“…The concept of Informal Work has considerably evolved over recent decades to more firmly align with the realities of working life in low-income settings Hill 2010;Routh 2011;Chen 2012;Carré, and Heintz 2013;Williams and Lansky 2013). The ILO's original definition was developed in the context of assisting national statistical offices to collect data on employment within the 'informal sector.'…”