Linking the Formal and Informal Economy

Basudeb Guha-Khasnobis is, since 2002, a research fellow and project director at UNU-WIDER. Previous appointments include IGIDR (Mumbai), the EXIM Bank of India (Bangalore) ICRIER (New Delhi), and as a research consultant for several international organizations.Ravi Kanbur is T.H. Lee Professor of World Affairs, International Professor of Applied Economics and Management, and Professor of Economics at Cornell University, and previously Professor of Economics at the University of Warwick, and Chief Economist for Africa at the World Bank.Elinor Ostrom was Arthur F. Bentley Professor of Political Science at Indiana University. She was also Co-Director, Workshop in Political Theory and Policy Analysis and Co-Director, Center for the Study of Institutions, Population and Environmental Change (CIPEC) at Indiana University. She was a member of the Expert Group on Development Issues of the Swedish Ministry for Foreign Affairs.

• 1. Beyond Formality and Informality ; CONCEPTS AND MEASUREMENT ; 2. Bureaucratic Form and the Informal Economy ; 3. The Global Path: Soft Law and Non-sovereigns Formalizing the Potency of the Informal Sector ; 4. The Relevance of the Concepts of Formality and Informality: A Theoretical Appraisal ; 5. Rethinking the Informal Economy: Linkages with the Formal Economy and the Formal Regulatory Environment ; 6. Formal and Informal Enterprises: Concept, Definition, and Measurement Issues in India ; EMPIRICAL STUDIES OF POLICIES AND INTERLINKING ; 7. The Impact of Regulation on Growth and Informality: Cross-Country Evidence ; 8. Financial Liberalization in Vietnam: Impact on Loans from Informal, Formal, and Semi-formal Providers ; 9. Blocking Human Potential: How Formal Policies Block the Informal Economy in the Maputo Corridor ; 10. Microinsurance for the Informal Economy Workers in India ; 11. Turning to Forestry for a Way Out of Poverty: Is Formalizing Property Rights Enough? ; 12. Voluntary Contributions to Informal Activities Producing Public Goods: Can These be Induced by Government and other Formal Sector Agents? Some Evidence from Indonesian Posyandus ; 13. Social Capital, Survival Strategies, and their Potential for Post-Conflict Governance in Liberia ; 14. Enforcement and Compliance in Lima's Street Markets: The Origins and Consequences of Policy Incoherence Toward Informal Traders ; 15. Formalizing the Informal: Is There a Way to Safely Unlock Human Potential Through Land Entitlement? A Review of Changing Land Administration in Africa

No matter how you divide up the developing world -- 'formal-informal',' legal -- 'extra-legal' --(my preference)one thing is not debatable: most people are poor, on the outside of the system looking in, and getting angrier every day. The message of this book is its time to stop talking and start designing reforms -- based on the informal practices and organizations that poor entrepreneurs already use. I second that motion. If you rebuild the system from the bottom-up, they will come -- with their enterprise, creativity, and piles of potential capital.