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informality

Informality as a channel to cope with rigid labor markets

Ximena Del Carpio's picture
Rigid labor markets prevent formalization, especially when labor costs are high relative to the productivity of the workforce. Evidence from around the world, from developed and developing countries, shows that employers have a number of ways they adjust to the costs imposed by onerous labor policies. One of the main lessons that policy makers should learn, is that adopting measures that reduce rigidity and costs can help mitigate the negative impacts on unemployment and informality.
 

Growth is not enough for Mozambique’s informal workers

Sam Jones's picture
Worries over Mozambique’s developmental trajectory have gained international attention  over the last 12 months. These suggest that Mozambique’s most recent phase of growth was built on shaky foundations, without deep roots into the broader domestic economy. The lack of structural transformation in the economy is reflected in the structure of employment, where the vast majority of households continue to rely on informal, smallholder agriculture. Raising agricultural productivity is indispensable.
 

A virtuous circle: Integrating waste pickers into solid waste management

Martha Chen's picture
Waste – its generation, collection, and disposal – is a major global challenge of the 21st century. Recycling waste drives environmental sustainability by reducing greenhouse gas emissions and stimulates the economy by supplying raw materials and packaging materials.
 
Waste pickers are the principal actors in reclaiming waste for the recycling industry. Across the world, large numbers of people from low-income and disadvantaged communities make a living collecting and sorting waste, and then selling reclaimed waste through intermediaries to the recycling industry. Where others see trash or garbage, the waste pickers see paper, cardboard, glass, and metal. They are skilled at sorting and bundling different types of waste by color, weight, and end use to sell to the recycling industry. Yet waste pickers are rarely recognized for the important role they play in creating value from the waste generated by others and in contributing to the reduction of carbon emissions.
 
Fortunately, around the world, waste pickers have been organizing and cities have begun to promote the virtuous circle that comes with integrating waste pickers, the world’s recyclers, into solid waste management.
 
Brazil was the first country to integrate waste pickers, through their cooperatives, into municipal solid waste management systems and the first to adopt a National Waste Policy, recognizing the contributions of waste pickers and providing a legal framework to enable cooperatives of waste pickers to contract as service providers. The national movement of waste pickers in Brazil was awarded a contract to clean the stadiums during the World Cup.
 

Devising Minimum Wages in Emerging Markets

Jobs Group's picture

Given the pros and cons of minimum wages in advanced economies, let alone in emerging markets, what types of information should policy makers be armed with? In this blog, we speak with two experts on the topic – John T. Addison (Professor of Economic Theory, University of South Carolina) and David Neumark (Professor of Economics, University of California, Irvine) – both of whom stress the importance of weighing the trade-offs for their own countries.

Raising awareness about Wisconsin's minimum wage, Milwaukee, August 1, 2012. Photo: Flickr/wisconsinjobsnow (Wisconsin Jobs Now)

Demystifying the Impact of Minimum Wages

Jobs Group's picture

In recent years, the minimum wage has become an increasingly popular for reducing inequality in many emerging markets, while others are still weighing whether to adopt one. But a lot of confusion still surrounds the impact of minimum wages in advanced economies, let alone in the emerging markets. In this blog, we speak with two experts on the topic: David Neumark (Professor of Economics, University of California, Irvine) and John T. Addison (Professor of Economic Theory, University of South Carolina). They both point to some job loss, especially for skilled workers, in advanced economies.

Singapore Clarke Quay Elgin Bridge underpass 2013 (by RSCLS street art collective). Photo: Flickr/66944824@N05 (Denis Bocquet)

Literacy Unplugged, Bollywood-style

Brij Kothari's picture
Photo credit: Still from Jodhaa Akbar with Same Language Subtitling, Copyright Disney UTV. Note: Subtitle in image reads "In the folds of these moments."


In India, the bulk of labor participation is in the informal sector, trapped in a vicious cycle of low skills, low wages, and low productivity. The vast majority of these individuals do not have the basic functional literacy needed for upping their job skills, and leveraging these gains to escape their cycle of poverty.The encouraging news is that there are numerous efforts under way to dramatically turn this situation around — including a successful program of using subtitles for Bollywood movies (see "Better Late than Never" in Education and Skills 2.0: New Targets and Innovative Approaches, 2014).

Universal Pension, Yes, Regressive Funding, No

David Robalino's picture

Silver miner in Potosi, Bolivia. Photo credit: ©urosrMariano Bosch, Carmen Pages, and Angel Melguizo at the Inter-American Development Bank (IDB) are proposing a new approach to expanding the coverage of pension systems in Latin America while helping create more and better jobs. Their ideas are spelled out in a new book "Better Pensions, Better Jobs: Towards Universal Coverage in Latin America and the Caribbean." The book is about Latin America but the problems discussed and proposed solutions are relevant for any middle-income country. I think the IDB's proposal is a great contribution to the debate on pension reform. Below I discuss some of the points they make that I agree with and those where I think other options could be considered.

Crafting Policies Where Informal is Normal – Part 2

Martha Chen's picture

At least half the workforce in the developing world is in the informal sector. Informal work is associated with low incomes, high risks, no benefits, and no representative voice. We recently spoke about the issue with Martha Chen, a Lecturer in Public Policy at the Harvard Kennedy School and the International Coordinator of the WIEGO Network, which seeks to improve the status of the working poor in the informal economy, especially women.

Crafting Policies Where Informal is Normal – Part 1

Martha Chen's picture

In the developing world, the informal workforce is at least half of the total workforce, and therefore subject to with low incomes, high risks, and no formal contracts or benefits. We recently spoke with Martha Chen, a Lecturer at the Harvard Kennedy School and the International Coordinator of the WIEGO Network. In part 1 of this two-part series, she argues that "informal is normal."


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