Informalization, Economic Growth and the Challenge of Creating Viable Labor Standards in Developing Countries

Heintz, James; Pollin, Robert

doi:10.2139/ssrn.427683

Cited by 55 publications

(46 citation statements)

References 18 publications

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“…Deregulation is portrayed as a policy tool that would bring about formalization in the economy. This perspective cannot explain how is it that nations with comparable levels of regulatory burdens have different degrees of informality in their economies, and why is it that in many developing countries, the size of the informal economy has expanded over the past few decades during what was a period of intensive deregulation (Heintz and Pollin, 2003).…”

Section: Resultsmentioning

confidence: 99%

Regulatory governance and the informal economy: cross-national comparisons

Kus

2010

Socio-Economic Review

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This article examines the relationship between state regulation and the informal economy at the macro-level across a broad set of countries. The analysis shows (a) that countries have different types of regulatory environments-varying by the degree of state regulation of economic activity-and the degree to which the state implements and enforces the existing regulations-and (b) that this variation helps explain why some nations have more informal economic activity than others. The findings also suggest that (c) contrary to what the neoliberal orthodoxy has prescribed over the past few decades, decreasing the degree of state regulation in the economy will not necessarily formalize the economy. The degree of regulation seems to have a significant association with the size of the informal economy only in nations with effective law enforcement. Where this is not the case-as in many developing nations-deregulatory policies are likely to be counter-productive in formalizing the economy.

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Section: Resultsmentioning

confidence: 99%

Regulatory governance and the informal economy: cross-national comparisons

Kus

2010

Socio-Economic Review

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“…The stiff competition leads to search for newer or increased forms of cost-cutting measures. Trade liberalization has reinforced the competitive pressures of global markets and intensified the search for lower production costs, whereby firms seek low-cost and 'flexible' labour relations in their production operations (Heintz and Pollin 2003;Beneria 2001;Mangan 2000;Pastore 2008). This has led to a shift to informal employment arrangements and exacerbated use of precarious types of employment (Carr and Chen 2002;Beneria 2001)-a move towards casualisation of labour.…”

Section: Conceptual Frameworkmentioning

confidence: 99%

Is There a Link Between Casual Employment and Export-Orientation of Firms? The Case of Kenya's Manufacturing Sector

Were¹

2011

The Review of Black Political Economy

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Empirical evidence on the link between trade and employment outcomes in Africa is severely limited. The paper analyses employment outcomes, that is, the rise in casual employment in Kenya's manufacturing sector in relation to firms' export orientation. While exporting firms generally account for a higher proportion of employment in the manufacturing sector, the proportion of workers in exporting firms declined by over 20% between the early 1990s and 2003. On the other hand, the proportion of casual workers employed in manufacturing firms increased over the same period. However, the empirical results show no strong evidence of "exporting" significantly influencing the proportion of casual workers employed by firms. The combination of an increasingly skilled labour force in Kenya and deepening casualisation among workers points to a conundrum that requires further analysis. That notwithstanding, the results suggest a need for policy focus not only on job creation, but also on the quality of jobs created.

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“…This is troubling given the persistent and valid argument that developmental processes and economic regulations are products of a country's structural position in the world economy Evans, 1979Evans, , 1995. More importantly, despite recent research on the effect of international trade and investment on the recent expansion of the informal economy (Carr and Chen, 2002;Heintz and Pollin, 2003;Phillips, 2011;Standing, 1999), most studies testing the legalist and dualist perspectives fail to adequately account for the effects of international trade and investment on the informal economy. In response to these theoretical and empirical gaps in the literature on the informal economy, I analyze how a country's structural position in the world economy, international trade, and foreign direct investment (FDI) affect the development of the informal economy.…”

Section: Economic Development Regulation and The Informal Economymentioning

confidence: 99%

Peripheral accumulation in the world economy: A cross-national analysis of the informal economy

Roberts

2013

International Journal of Comparative Sociology

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The persistence and growth of the informal economy have puzzled researchers and challenged mainstream explanations of the development of the informal economy. This study utilizes a world-systems approach for explaining cross-national variation in the size of the informal economy for a sample of 74 developing and developed countries observed over a recent 8-year period (1999-2007). According to this approach, the informal economy is a characteristic of peripheral accumulation in the world economy and its development is driven by unequal exchange in international trade and foreign capital penetration. Based on estimates from random and fixed-effects regression models using multiple measures of world-system position, countries in the periphery and semi-periphery of the world economy have larger informal economies than core countries. More importantly, this difference in the development of the informal economy between the core, semi-periphery, and periphery is partially explained by the effects of international trade and foreign direct investment. Overall, the findings indicate that the development and persistence of the informal economy are driven by the structure of the world economy and processes of economic globalization.

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Informalization, Economic Growth and the Challenge of Creating Viable Labor Standards in Developing Countries

Cited by 55 publications

References 18 publications

Regulatory governance and the informal economy: cross-national comparisons

Regulatory governance and the informal economy: cross-national comparisons

Is There a Link Between Casual Employment and Export-Orientation of Firms? The Case of Kenya's Manufacturing Sector

Peripheral accumulation in the world economy: A cross-national analysis of the informal economy

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