The informal economy has grown significantly and is linked to the formal economy in various ways. It includes activities like unpaid domestic work, small-scale self-employment, and casual day labor that occur outside official business registration, taxation, social security, and labor protections. Factors driving its expansion include business strategies to cut costs by avoiding regulations and unions, economic crises pushing people into informal work, and inadequate enforcement of labor laws. While it provides income opportunities, the informal economy generally worsens wages and conditions for workers and undermines technological progress. Policy reforms are needed to address these negative consequences.
The informal economy has grown significantly and is linked to the formal economy in various ways. It includes activities like unpaid domestic work, small-scale self-employment, and casual day labor that occur outside official business registration, taxation, social security, and labor protections. Factors driving its expansion include business strategies to cut costs by avoiding regulations and unions, economic crises pushing people into informal work, and inadequate enforcement of labor laws. While it provides income opportunities, the informal economy generally worsens wages and conditions for workers and undermines technological progress. Policy reforms are needed to address these negative consequences.
The informal economy has grown significantly and is linked to the formal economy in various ways. It includes activities like unpaid domestic work, small-scale self-employment, and casual day labor that occur outside official business registration, taxation, social security, and labor protections. Factors driving its expansion include business strategies to cut costs by avoiding regulations and unions, economic crises pushing people into informal work, and inadequate enforcement of labor laws. While it provides income opportunities, the informal economy generally worsens wages and conditions for workers and undermines technological progress. Policy reforms are needed to address these negative consequences.
The informal economy has grown significantly and is linked to the formal economy in various ways. It includes activities like unpaid domestic work, small-scale self-employment, and casual day labor that occur outside official business registration, taxation, social security, and labor protections. Factors driving its expansion include business strategies to cut costs by avoiding regulations and unions, economic crises pushing people into informal work, and inadequate enforcement of labor laws. While it provides income opportunities, the informal economy generally worsens wages and conditions for workers and undermines technological progress. Policy reforms are needed to address these negative consequences.
Portes note, it is precisely because there is a formal economy-an institutional frame- work of economic activity-that we can Unofficial Work speak of an informal one (p. 13). The book includes many examples of subcontracting, where large firms that operate according to volved in creating, expanding, and strength- official rules send production out to smaller, The Informal Economy. Studies in Advanced ening informal economic arrangements in informal firms as a way to cut costs and and Less Developed Countries. ALEJANDRO PORTES, MANUEL CASTELLS, and LAUREN A. specific contexts. In Bolivia, informal eco- increase flexibility. In Mexico City, Beneria BENTON, Eds. Johns Hopkins University Press, nomic activities have always been wide- argues that intense competition among Baltimore, 1989. viii, 327 pp. $39.50; paper, spread among poor families trying to sur- small subcontractors to obtain work from $16.95. vive, but the shift to a cocaine economy has larger firms gives these large firms an ability led to their expansion, particularly in the to impose their own terms. Individuals The informal economy, the editors of this form ofurban underground activities related themselves may switch back and forth be- collection say, has grown in significance in to marketing of imported contraband tween informal and formal sectors, as Rob- the last decade. Homework, putting out, goods. In an interesting account of Miami's erts shows in Guadalajara, where participa- and other informal practices are flourishing informal sectors, Stepick argues that infor- tion in the informal economy depends on in Third World cities and expanding malization among Haitians and Cubans is the individual's life stage. Low-income men, linked to ethnic antagonism and the wider for example, typically start out in informal
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throughout the industrialized countries. The Informal Economy offers studies of the struc- society's rejection of immigrants. Denied employment, move on to a formal occupa- ture and dynamics of this phenomenon that entry into construction unions, Cubans cre- tion, and end their working lives as self- range over 14 cities and 10 different coun- ated their own non-union firms that relied employed workers. Roberts emphasizes that tries on several continents, including South on informal practices such as paying workers working-class households combine informal America, North America, and Europe. The in cash. Haitian refugees, generally unable and formal economic strategies; most have at essays show that informal economic activi- to find jobs in the formal economy, have least one member in the formal sector-with ties cut across various social sectors, from survived through casual self-employment in some access to the social security system-as street peddlers in Bolivia to successful Cu- their own ethnic community, setting up well as others in informal employment. ban entrepreneurs in Miami to black market small businesses such as dressmaking and In considering the consequences of the operators in the Soviet Union. restaurants in their homes. Stepick makes informal economy, the book clearly weighs What is the informal economy? Accord- the point that Cubans' informal activities are in on the negative side. Summing up the ing to Castells and Portes, in their overview integrated with the broader economy; Cu- empirical results, the editors do note that chapter, it is "unregulated by the institutions bans work in sectors of the garment, con- there are some positive effects. Homework, of society, in a legal and social environment struction, and restaurant industries where for instance, allows women to balance in- in which similar activities are regulated" (p. informal labor practices maintain low labor come earning and household tasks, and in- 12). Most of the book's 14 case studies use costs. The Haitians' informal economic ac- formal enterprises contribute to the viability definitions that are variations on this theme, tivities, by contrast, are survival strategies of ethnic neighborhoods in some American though a couple add small scale of produc- that are isolated from the broader economy. cities. There are also a few exceptional in- tion as a criterion. The role of the state in the creation and stances of "informal economies of Among the many factors responsible for operation of the informal sector crops up in growth"-the Miami Cuban and central Ita- the growth of the informal economy in many of the contributions. Sometimes, the ly cases in the book-although these, as the contemporary societies, Castells and Portes state looks the other way, failing to con- editors argue, are unlikely to be reproduced suggest, are owners' strategies to assert he- trol-and thereby stimulating the growth elsewhere owing to unique historical and gemony in the face of the power of organ- of-the informal economy. Fernandez-Kelly cultural features underlying the success sto- ized labor and the regulation of the econo- and Garcia show that inadequate funding ries. Overall, the informal economy de- my by the state. Through informalization, for government watchdog agencies and presses wages, worsens other job conditions, business firms seek to undermine union loopholes in labor legislation have provided and reduces occupational safeguards for control of the work process and to escape a favorable climate for informalization in workers. And informalization encourages state legislation and tax increases. Because of Florida and California. In England, the entire industries to resort to exploitative the growing integration of national econo- Thatcher government's supply-side econom- labor arrangements rather than technologi- mies in the international system, manufac- ic strategies have aimed to deregulate the cal innovation. Given these negative impli- turers everywhere compete to produce labor market and encourage the use of tem- cations, the editors call for policy initiatives cheaper goods by reducing labor costs- porary workers. By 1987, according to that focus on breaking the direct link be- through lowering wages, avoiding social Standing, a third of the employed were part- tween social benefits and employment in benefits and payments to the state, and timers, temporary workers, homeworkers, private firms-by government guarantees of reducing state- or union-imposed con- and "self-employed." In the Soviet Union, minimum living standards to "people as straints on hiring and dismissal. And the where the state tries to control the workings people and not as workers" (p. 310). world economic crisis since the mid-1970s of the entire economy tightly and severely The Informal Economy makes clear that the has driven countless people, especially in the limits private income, people add to their economic arrangements recorded in official peripheral countries, to eke out a living in the incomes in a variety of illicit ways-for statistics are not the only ones worth study- only way available: at the "margins of rules example, by charging "rent" for access to ing. Given the importance of the subject, it and organizational arrangements" (p. 29). scarce socialist-owned goods or services and is a shame that many of the essays are The case studies show the processes in by plain theft from the state. ponderous and filled with jargon. The find- 9 FEBRUARY I990 BOOK REVIEWS 73I ings presented, and the editors' reviews and biostratigraphic problems seems unlikely. heavier hand in selecting papers or at least generalizations, provide a wealth of useful A few papers include paleoecological con- worked to raise all of them to professional material and raise significant questions that clusions. For example, in explaining the standards. For example, the following bla- will undoubtedly stimulate future inquiry stratigraphic distribution of track types in tant sarcasm (Agnew et al.) is included: and cross-national comparisons on the "fun- the Triassic, Demathieu remarks that "the "Field preservation, with the requirements damental, although elusive, reality" (p. 1) of competition between the two groups of of at least fencing the site and possibly the informal economy. reptiles must have been relatively great." roofing it as well may just be too expensive NANcY FONER Competition is a phenomenon that most for busy research scientists to go seeking Department of Anthropology, ecologists find difficult to detect at any funds. Who can blame them when it is such State University of New York, taxonomic level. It seems highly unlikely a time-consuming activity to protect a site?" Purchase, NY 10577 that footprints, identifiable at best to the Such a tirade is entirely irrelevant. family level, can be useful in addressing the I consider this a useful book, although I complex issue of competition, and such a do not share the optimism of the editors that discussion should be dismissed. vertebrate paleoichnology is ready to stand Paleoichnology Another questionable point is raised by on its own. Recognition of the abundance the discussion of prints attributed to swim- of vertebrate tracks is a different issue from Dinosaur Tracks and Traces. DAVID D. GIL- ming sauropods (for example, by Ishigaki). their practical utility for detailed studies. I LEITE and MARTIN G. LOCKLEY, Eds. Cam- There exist three distinctly different types of encourage those dealing with trace fossils bridge University Press, New York, 1989. xviii, 454 pp., illus. $54.50. Based on a symposium, trackways of sauropods that are considered and dinosaurs to become familiar with this Albuquerque, NM, May 1986. to indicate swimming (see Lockley and volume, for it represents the state of the Conrad's paper for references). Rather than science of fossil footprint studies. I think the The field of vertebrate paleoichnology is consider these tracks as representing three field has a long road ahead in determining attempting to come of age, and the matura- different styles of swimming, Lockley and its potentials and limitations. Perhaps the tion process has been expressed largely in Conrad interpret them as underprints, a most appropriate remark within the book the form of meetings devoted to new discov- feature created in the subsurface beneath the concerning this field is, "The journey of a eries. This volume, the result of the First original tracks. This interpretation may be thousand miles begins with a single step" International Symposium on Dinosaur correct, but the authors continue by stating (Lao Tse, p. 3). That is precisely how this Tracks and Traces, is a collection of 50 that attribution of the prints to swimming volume should be viewed. papers of variable quality, devoted to estab- sauropods will contribute to reviving the ANTHONY R. FIOIULLO lishing vertebrate paleoichnology as a field hypothesis that sauropods were aquatic (p. Section of Vertebrate Fossils, in its own right. 124). Humans are certainly not aquatic, yet Carnegie Museum of Natural History, The obvious strength of this volume is in they can leave marks on lake or stream Pittsburgh, PA 15213 providing a single reference source for verte- bottoms when they are in the water. The brate paleoichnology. A number of papers fact that sauropods may have likewise spent provide useful overviews of the occurrences time in the water, swimming or otherwise, of footprints in various parts of the world. does not imply a preferred aquatic mode of Quantum Electrodynamics Stimulating papers relating functional mor- life. A useful paleoecological point in the phology to gait are presented (for example, same chapter concerns the distribution of Photons and Atoms. Introduction to Quantum by Padian and Olsen). Several other papers tracks through various depositional environ- Electrodynamics. CLAUDE COHEN-TANNOUDJI, provide good descriptive accounts of new ments, drawing attention particularly to the JACQUEs DupoNr-Roc, and GILBERT GRYN- BERG. Wiley-Interscience, New York, 1989. xx, track localities or describe old trackways for numerous occurrences of tracks within dune 468 pp. $59.95. Translated from the French the first time (for example, Farlow et al.). facies. The potential of arid dune environ- edition (Paris, 1987). The editors emphasize that the study of ments as a source of paleontological infor- footprints is now ready to move from these mation is beginning to be recognized. Recent years have witnessed a renaissance more traditional topics and make new con- Several papers deal descriptively with egg- of interest in atomic physics and its interplay tributions to our understanding of paleo- shells. I am not clear why eggs are consid- with quantum optics. Laser, maser, and ecology, biostratigraphy, and the behavior ered to be only "traces" of dinosaurs. Eggs synchrotron sources have revolutionized the of extinct organisms. Reality, however, may with embryos certainly cannot be treated as study of interactions between matter and argue otherwise. such. If eggs are considered to be traces radiation. More recently, the invention and The consensus is that footprints cannot be because they are composed of calcium car- perfection of traps for single atoms-hon- assigned to a taxonomic level finer than bonate rather than apatite as are bones, why ored by the Nobel prize a few months ago- family. Despite this repeated admission, the should we not consider all of invertebrate have opened the door to stunning experi- editors in the introduction to the section on paleontology the study of trace fossils? The ments on individual atoms interacting with biostratigraphy (p. 199) insist that verte- reader is left with the impression that this light. Previously, only large ensembles of brate tracks hold much promise in this field. book is intended as a bandwagon and the atoms could be dealt with, and a number of Since most dinosaur families are long-lived, section dealing with eggshells is included to quantum mechanical effects were thus hid- recognition of tracks at a family level can, at insure the field's popularity. den. The new developments have stimulated best, provide only a large-scale resolution to Overall the layout of the book is good, a vast amount of research. stratigraphic questions. For some questions, and there are an acceptably low number of This book, which is a translation of a resolution no more precise than, for exam- typographical errors, unlisted citations, and French work, presents the theoretical foun- ple, assignment to the Upper Cretaceous poorly reproduced graphics. It may come as dations for the description of atoms and may be sufficient. However, the prospect a surprise that so many people were able to radiation and their interplay. The underly- that a tool limited to such large-scale resolu- contribute to a volume on this subject. The ing theory, quantum electrodynamics, is tion can make a significant contribution to editors, however, should have exercised a well covered by textbooks, but these text- 732 SCIENCE, VOL. 247