Synthesis documents

Informality, Growth and Development in Africa, Nancy Benjamin and Ahmadou Aly Mbaye, UNU-WIDER, 2014

    This paper lays out some of the basic characteristics of the informal sector in sub-Saharan Africa (SSA), relevant institutions, and development issues. Proposed policy approaches recognize both that the great capacity of the informal sector is not easily harnessed into formal systems, and that
    development is problematic when the bulk of economic activity operates outside of the formal regulatory regime.

    The paper refers largely to the urban, non-agricultural informal economy. It summarises key characteristics of informality in Africa and provides answers to four key questions: Why the informal sector is so pervasive in Africa, why informal firms are less productive than formal firms, whether development organisations should push for the formalisation of informal firms, and how to best help firms and employees in the informal sector.