1.1. Informal Economy The concept of informal sector stems from early 1970s, when economic anthropologist Keith Hart conducted his research in Ghana having found out it not only existed but expanded. Later it was accepted by ILO, (International Labour Organization) perceiving the range in which marginal workforce turned into the profitable enterprises. It was followed up with the International Labour conference in 2002 broadening its concept to an economy wide phenomenon involving the jobs and workers inside (ILO, 2013). There are also various definitions incorporated by the various economist and sociologists, but ILO Resolution of 2002 delivered the one commonly applied in many states: «The informal economy comprises half to three-quarters of all non-agricultural employment in developing countries. Although it is hard to generalize concerning the quality of informal employment, it most often means poor employment conditions and is associated with increasing poverty. Some of the characteristic features of informal employment are lack of protection in the event of non-payment of wages, compulsory overtime or extra shifts, lay-offs without notice or compensation, unsafe working conditions and the absence of social benefits such as pensions, sick pay and health insurance. Women, migrants and other vulnerable groups of workers who are excluded from other opportunities have little choice but to take informal low-quality jobs (ILO, 2002)”. Various socio-anthropologists and economists define informal sector in their own particular way. Meagher (2004) introduces following categories: survival informal group, dependent workers and entrepreneurs. House (1984) investigates the motivation triggering entrepreneurs start a business which accor... ... middle of paper ... ...rivate sector. The overall negative outcome could be observed on the post USSR countries, named as “transition countries”. Only Poland and Hungary had success along with Georgia, but the latter showed the worst case of output due to the civil wars in 1990s. The paper will analyse the relation between informal sector, formalization outcomes and macroeconomic structural changes. The analysis is based on the three country examples: Brazil, Vietnam and Georgia. Those countries were selected due to their experience to cope with the informal sector, i.e. Brazil was chosen for its successful public and financial policy ending in the rise of formal sector; Vietnam for its partly successful formalization, but more for its successful informal institutions and lastly Georgia, conducting all necessary structural adjustments, but ending in decrease of formalization incentives.
Lora Jo Foo. “The Yale Law Journal”, Vol. 103, No. 8, Symposium: The Informal Economy
Once Gorbachev released and implemented his reforms, the economy of the Soviet Union was destroyed (Danks 5). For example, the alcohol ban, which was a law created to prevent the sales and production of liquors, caused profits to drop for many companies, causing unemployment and inflation (Danks 5). The ban had been created so the workforce would be more efficient and could help the economy grow, but it had the opposite effect by decreasing the number of jobs available and c...
All participants who participated in this study found their current jobs, as well as previous work in coethnic workplaces, through networking. It was either through a friend or a family member. Other than two participants who were recently promoted supervisors, other participants received either minimum wage or lower than minimum wage when employed for cash. Woman (Hina) previous employed in a restaurant worked for $6 per hours. Literature also identified that workers who are recruited through informal means are subject to lower wages than those working in the mainstream labour market (Catanzarite and Aguilera 2002).
According to Shipler, the working poor need remedies to improve their circumstances. Throughout his novel, Shipler addressed potential solutions that seemed to adjust the lives of the working poor. To help combat low self-esteem and competence more programs should be created by the state or local communities that could be created to assist the working poor in getting their GEDs, personal hygiene if necessary, learning skills that are necessary for job training, balancing daily personal finances, and learning how to eat healthier on a limited income. The more confidence an individual has the more likely they will be outgoing or assertive and will be more willing to apply for jobs. Applying jobs is intimidating for a college graduate who has
I. Introduction A sweatshop is a workplace where individuals work with no benefits, inadequate living wages, and poor working conditions (Dictionary.com). Sweatshops can be found all around the world, especially in developing nations where local laws are easily corrupted: Central America, South America, Asia, and in certain places in Europe (Background on Sweatshops). China, Honduras, Nicaragua, the Philippines and Bangladesh are the main places where most sweatshop products are made (McAllister). Often, sweatshop workers are individuals who have immigrated and are working in other countries.
Globalization and industrialization contribute to the existence of sweatshops, which are where garments are made cheaply, because they are moving production and consumption of those cheap goods. Industrialization has enabled for global distribution, to exchange those goods around the world. They can also set apart the circumstances of consumption and production, which Western countries as mass consumers, are protected from of producers in less developed countries. These factories are usually located in less developed countries and face worker exploitation and changes in social structures. Technological innovation allows for machines to take the place of workers and do all the dirty work instead of workers doing hours of hard work by hand.
The Soviet Union, which was once a world superpower in the 19th century saw itself in chaos going into the 20th century. These chaoses were marked by the new ideas brought in by the new leaders who had emerged eventually into power. Almost every aspect of the Soviet Union was crumbling at this period both politically and socially, as well as the economy. There were underlying reasons for the collapse of communism in the Soviet Union and eventually Eastern Europe. The economy is the most significant aspect of every government. The soviet economy was highly centralized with a “command economy” (p.1. fsmitha.com), which had been broken down due to its complexity and centrally controlled with corruption involved in it. A strong government needs a strong economy to maintain its power and influence, but in this case the economic planning of the Soviet Union was just not working, which had an influence in other communist nations in Eastern Europe as they declined to collapse.
Monetary and fiscal policy and their applications to the third world countries with a huge informal sector
The main concern of the new government was the transformation of Czechoslovakia from a state-controlled to a free market economy (Embassy of the Slovak Republic). Disputes arose between the two republics about reform process which focused on privatization, the encouragement of foreign investment, policy of macro-economic stabilization, price liberalization, and liberalization of foreign trade (Slovakia.Org, “20th Century”). The Czech Republic was more economically developed than the industrial-based economy of Slovakia (Slovakia.Org, “20th Century”). The transition to a market economy left the Slovak Republic to endure greater economic hardships than the Czech Republic (Sovakia.Org, “20th Century”). For example, the federal government chose to dramatically cut the country’s defense industry, resulting in a large decrease in industrial production and a large rise in unemployment in Slovakia (Slovakia.Org, “Slovak Economy”). This took place because the economy that rose out of the communist era in Slovakia was based on industrial production, particularly on weapons and military equipment (Slovakia.Org, “Slovak Economy”).
After the dissolution of the Soviet Union in 1991, the question of economic reform was extremely prevalent. Since the Soviet Union had been “defeated,” Communism was consequently defeated. This resulted in Western powers, particularly the United States, and Western banks debating what should be done to the post-Soviet economies. At the same time, however, non-Soviet states were also undergoing economic transitions. The two main modes of economic reform were Shock Therapy and Gradual therapy. Shock therapy consisted of a rapid-fire shift from a Communist economy to a capitalist one. Shock therapy was notably practiced in Russia and Poland, with tremendously different results. The most well-known gradualist transition may have been China, but
Critically one of the larger factors of this topic where the problems begin is in poverty. Citizens of the United States often argue that lack of social reform has significant effects throughout all communities and their poverty levels in America. This may be true to a certain degree, but a largely missed fact is that exponential growth has occurred vastly in the past hundred years shown through histories’ short industrialization of the US; population size strongly correlates to the increase cost of living and the poverty threshold. Social form favors the increase of manufacturing which has dominated not only our capitalist market but many foreign markets as well; while compared to service occupations which have made little advancement compared to production output and technology. Those key components affect largely the amount of jobs available and knowledge required to compete in a competitive job market, yet allow employers to operate at minimal expense level. This disparity of finite jobs creates the separation of classes respectively relating people’s ability t...
We have positioned advantages and disadvantages of being formal/informal to better understand the challenges in both circumstances. However, it is necessary to closely analyse the precedence of successful formalization as well as successful informal institutions in order to challenge modern economic paradigms in development economics.
Not all vendors are full time, and many use vending as a supplement to their income from another job, but for some it is their sole means of employment (Muñoz 2012: 2). Since many of these vendors are immigrants, with approximately 60% being undocumented, they face discrimination from the formal economy and many lack attributes such as language ability and legal status, that are required to gain a formal occupation (Kettles 2004: 23). For them, remaining in the informal economy is worth the risk and many vendors find it preferable that they are able to work on their own terms (Chinchilla, Chinchilla and Hamilton 1996:
Could you imagine working up to twelve hours a day and only making less than a dollar? Well that was the everyday life of a simple migrant worker during The Depression. These workers were forced to live this lifestyle after the Dust Bowl hit many states. Although they struggled a majority of the Depression, they still managed to get the job that needed to be done to continue to support their family.
Entrepreneurship is an important aspect of social, economic and community life. It can be viewed as a critical factor to economic growth as well as a way of addressing unemployment (Nolan, 2003).Entrepreneurs are people who are persistently focused on identifying opportunities, they seek to create something worthwhile while taking into account foreseeable risk and rewards associated with the efforts (Nolan, 2003). Furthermore, entrepreneurs are frequently understood to be individuals who discover market needs and establish new business to meet those identified opportunities. The following assignment will firstly discuss the types of entrepreneurship, secondly it will discuss the reasons people become entrepreneurs, and thirdly it will discuss the importance of entrepreneurship.