A chance to extend the seminar conversation around John Conroy's "Intimations of the informal economy".

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Keith,

Thank you for opening this thread. I enjoyed reading about your 'fitful research' on the Lancashire workers and your insights on how this foregrounds the works of Marxist historians.

I agree with you that informality, and the way this discourse has unfolded over the past few decades, offers insights for the ongoing inquiries into the human economy of what people do in their everyday lives. John Conroy nicely summed up the thrust of your writing that 'discrepancies' between theory and reality is key to understanding any discourse including informality. But I somehow disagree with your earlier comment that it is only the anthropologists who find it hard to work with other, more formalist disciplines, on making theory speak to reality.  The reverse is also true. I feel it is rather common for anthropologists to rush to deconstruction without having sufficient understanding of the problem, or solutions being developed by people or policymakers. Or to be dismissive of any other research methodology than ethnographic claim that only they speak the subaltern voice because they have the local tongue. This is as bad as neocon economists thrashing anyone who is not a market fanatic.

Coming back to the discrepancy between 'theory' and 'practice,' I think it is important to shed the notion that theory is somehow objective/neutral while practice is sheer pragmatic.  Nobody in the seminar said this and I believe that is an enlightened crowd, but I think we should not overlook this assumption that is out there. Theory is a political construct. For a topic like informality, which (has now become) a develoopmental frontier, no theory can be independent of the global politics of developmental bureaucratisation.  What you say about the study on Turkey is for me a reminder of this. The question, then, is how do we deal with this as scholars and concerned global citizens? Do we simply use this new/added dimension to refine our writings and assume that words alone can counter politics? Or do we at least look for, if we cannot build ourselves, alliances that are evolving / may evolve to counter the politics of the developmental status quo?

Sorry this really is a rant...

it is important to shed the notion that theory is somehow objective/neutral while practice is sheer pragmatic

Agreed. But who is suggesting any such thing? Speaking only for myself, I have long since concluded that debates over theory in the social sciences resemble those over the Constitution of the United States described in Federalist 1.


Happy will it be if our choice should be directed by a judicious estimate of our true interests, unperplexed and unbiased by considerations not connected with the public good. But this is a thing more ardently to be wished than seriously to be expected. The plan offered to our deliberations affects too many particular interests, innovates upon too many local institutions, not to involve in its discussion a variety of objects foreign to its merits, and of views, passions and prejudices little favorable to the discovery of truth.


Conversely, I would add that in several decades of involvement with business people and political activists, I have never seen a proposal based purely on the narrow pragmatism embodied in instrumental reason gain any traction at all. All are informed by theories of one sort or another, though many are obviously cockamamy. Keynes got it basically right when he wrote that, "“even the most practical man of affairs is usually in the thrall of the ideas of some long-dead economist”. I would only disagree by extending the list to include long-dead philosophers or theologians as well, the constructors of ideas about human nature and society that both the long-dead economist and his current disciples take for granted. 


Meanwhile, in the formal economy.

The European: Four years after the beginning of the financial crisis, are you encouraged by the ways in which economists have tried to make sense of it, and by the ways in which those insights have been taken up by policy makers?


Stiglitz: Let me break this down in a slightly different way. Academic economists played a big role in causing the crisis. Their models were overly simplified, distorted, and left out the most important aspects. Those faulty models then encouraged policy-makers to believe that the markets would solve all the problems. Before the crisis, if I had been a narrow-minded economist, I would have been very pleased to see that academics had a big impact on policy. But unfortunately that was bad for the world. After the crisis, you would have hoped that the academic profession had changed and that policy-making had changed with it and would become more skeptical and cautious. You would have expected that after all the wrong predictions of the past, politics would have demanded from academics a rethinking of their theories. I am broadly disappointed on all accounts.

The remainder of the article can be found here

One problem about comparing developmental context with national constitution making is that the latter is done by elected representatives through a clear(er) mandate whereas the former has to negotiate murkier power equations. I would reconsider the 'depoliticizing development' debate.

 

Stiglitz is undoubtedly among the most honest thinkers of our time...

I’m going to look back to Keith’s last intervention, in the debate on the OAC forum, a week ago. I said then that I didn’t want to risk an anti-climax. But since the discussion has a new lease of life in the ‘Human Economy’ group I feel less constrained. So here goes!

Keith offered us ‘a comment on how the informal economy/sector [concept] has distracted us from grounding our inquiries in the human economy of what people do in their everyday lives’. As an antidote to this he described the experience of informality in Northeast Lancashire in the immediate post-WWII period (small ‘strip-mining’ enterprises, along with a set of other activities, some modern and others ancient). I gained the impression that these were activities additional to the primary (formal) source of income enjoyed by the people involved.

Also, Keith gave us an excursion back to the mid-nineteenth century and the cotton famine, during which mill workers declined to join their masters in breaking the blockade of Confederate cotton exports, enduring considerable hardship in the process. During this ordeal, ‘the informal economy and their own home-made institutions’ (‘friendly societies and similar mechanisms of social insurance’) sustained them. For both the nineteenth and twentieth centuries, he presented a picture of multiple sources of income, both formal and informal, enjoyed by factory workers.

This was a more complex picture than I had gained from my understanding of Beatrice Webb (I must admit, from reading Stedman Jones as a secondary source). After London, she found there ‘a whole new working class civilization in the North … [built around] … three institutions made by the workers themselves: the chapel, the union and the co-op’. But my understanding of Webb (again from reading Stedman Jones) was that she had seen no informal economy in the northern industrial towns – or at least nothing equivalent to that found in London. Indeed, by her account ne’er-do-wells and unemployables from the north inevitably gravitated to London where they joined Mayhew’s inchoate mass of street people. But by Keith’s account there was a range of activities in the north, conducted as sidelines by the formally-employed working class – and which, by implication, helped to sustain them during the period of open unemployment caused by the cotton famine.

From this Keith feels able to conclude that ‘there is therefore a social history of working class institutions and economic practices in nineteenth century Britain which offers material for comparison with developing countries today. It is surely essential to combine studies of the workplace with the institutions people devise outside it to meet their needs. The informal economy was as much a strategy of the Lancashire factory workers as it is inside and outside the citadel of protected high-wage employment in India today’. This is all very tantalizing and one can only think it’s a pity Keith never got to write this material up. Am I interpolating too much into Keith’s narrative? Certainly my interpretation is self-serving to the extent it appears consistent with my earlier interpretation of Hart’s work.  

Mallika talks of Indian cases, and cites the work of Jan Breman (whose writings I also referred to during the forum/seminar) and his ‘footloose labour’ set adrift by the forces of deregulation in post-Nehru India. We are discussing a scenario of a magnitude unexampled by European experience. But (to use her phrase) ‘developmental bureaucratization’, in process of being dismantled, underlies these phenomena in contemporary India. The abandonment of the ‘permit raj’, and the leap beyond the ‘Hindu rate of growth’ which shackled Nehruvian India for generations after Independence, have introduced an era of change which is altering income distributions and threatening social stability, while offering an enormous political contrast with the processes at work in its larger neighbor across the Hindu Kush.

Finally, John (McCreery), I’m knocked out by the passage you quote from the Federalist Papers, concerning the need for a public policy ‘unbiased by considerations not connected with the public good’ … ‘a thing more ardently to be wished than seriously to be expected’.



Mallika Shakya said:

Keith,

Thank you for opening this thread. I enjoyed reading about your 'fitful research' on the Lancashire workers and your insights on how this foregrounds the works of Marxist historians.

I agree with you that informality, and the way this discourse has unfolded over the past few decades, offers insights for the ongoing inquiries into the human economy of what people do in their everyday lives. John Conroy nicely summed up the thrust of your writing that 'discrepancies' between theory and reality is key to understanding any discourse including informality. But I somehow disagree with your earlier comment that it is only the anthropologists who find it hard to work with other, more formalist disciplines, on making theory speak to reality.  The reverse is also true. I feel it is rather common for anthropologists to rush to deconstruction without having sufficient understanding of the problem, or solutions being developed by people or policymakers. Or to be dismissive of any other research methodology than ethnographic claim that only they speak the subaltern voice because they have the local tongue. This is as bad as neocon economists thrashing anyone who is not a market fanatic.

Coming back to the discrepancy between 'theory' and 'practice,' I think it is important to shed the notion that theory is somehow objective/neutral while practice is sheer pragmatic.  Nobody in the seminar said this and I believe that is an enlightened crowd, but I think we should not overlook this assumption that is out there. Theory is a political construct. For a topic like informality, which (has now become) a develoopmental frontier, no theory can be independent of the global politics of developmental bureaucratisation.  What you say about the study on Turkey is for me a reminder of this. The question, then, is how do we deal with this as scholars and concerned global citizens? Do we simply use this new/added dimension to refine our writings and assume that words alone can counter politics? Or do we at least look for, if we cannot build ourselves, alliances that are evolving / may evolve to counter the politics of the developmental status quo?

Sorry this really is a rant...

Hi John,

I did write up the substance of my last comment in a review essay on Worlds of Indian Labour for Critique of Anthropology (2000) which I have uploaded here, since it would otherwise lie festering behind Sage's paywall.

I have spent many years reading, doing fieldwork and historical research on industrial Lancashire in the19th century, based partly on my experience of living there after WW2. This never matured into an independent published work, but then the same could be said of my Accra fieldwork in the 60s which exists today mainly in the form of soundbites from a couple of well-read articles. This review essay is as close as I ever got to expressing my dissatisfaction with conventional accounts of the industrial class system.

My central beef is with Marx and Engels who wanted to separate the factory proletariat from both the disorganized rabble and the small proprietors (lower middle class). The Webbs played their part in reproducing this intellectual system. My line is that workers have more sense than to rely exclusively on wage employment, even when they have it, since they know better than most academics what business cycles feel like for working people.

Maybe I have been too kind so far, but now the gloves are off. You have read Stedman Jones on Webb and you prefer her secondhand evidence to my admittedly summary statement of something different. How would she know as a teenage visitor what workers and the unemployed did in their spare time? I like her account of working class institutions which does go against the standard Marxist account. But the point is people everywhere have plural sources of income on either side of the formal legal system.

Phil pointed out that, from his perspective today, most London street traders work with and against the rules in quite complex ways. A tourist might not notice this as a mass phenomenon akin to Oliver Twist and Mayhew's London in the 1860s, any more than s/he would recognize the dodgy deals performed from the City of London. But the idea that Manchester was clean (formal) and London dirty (informal) over a century ago is a gross geographism that even superficial reading of the relevant social and economic history would refute.

Not to put too fine a point on it, I write of what I know from growing up in inner city Manchester after the war and living in Rossendale as an adult.



John Conroy said:

I’m going to look back to Keith’s last intervention, in the debate on the OAC forum, a week ago. I said then that I didn’t want to risk an anti-climax. But since the discussion has a new lease of life in the ‘Human Economy’ group I feel less constrained. So here goes!

Attachments:
"It is surely essential to combine studies of the workplace with the institutions people devise outside it to meet their needs."

This line from Keith's review article resonates strongly with me, evoking, as it does, memories from my childhood that illustrate sources of the kind of resilience that Keith attributes to the Lancashire working class. The relevant background here is that my parents, who grew up in Savannah, Georgia, during the Great Depression moved to Virginia, where my dad went to the Newport News Shipbuilding and Dry Dock Company's apprentice school and became a master machinist. Three events shaped vivid memories for me.

1. My father wanted to live in the country. My maternal grandfather, a pharmacist with a drugstore in Savannah, provided the down payment that enabled the purchase of the place on which I grew up, located at the head of Patrick's Creek, which flows via the Poquoson River into Chesapeake Bay.my maternal grandfather later came to live with us, after being diagnosed with lung cancer and seeking treatment available in Virginia.

2. When my parents bought the place, the property included a large, ramshackle wooden house, have of which they rented to friends, who were careless with a wood stove, resulting in the fire that burned the place to the ground. While my mother, brother and I were sent to stay in Savannah, my paternal grandfather and my father's brothers came up to Virginia to build the new house, an enterprise in which they were helped on weekends by men from my parents' church. Women from the church came along, bringing casseroles, cakes and salads to feed the men and the kids who also came along to play in our big front yard while their fathers worked on the house.

3. During a slack period at the shipyard, when my father was laid off, I was largely unaware of what was going on. I did notice, however, that the vegetable garden got bigger, we started raising chickens and ducks, and we ate a lot of fish, crabs and oysters from the creek in front of the house.

Obviously, our family enjoyed the benefits of a good deal of economic and cultural capital. We were never poor. But I read Keith's review and tick off what I remember, kinship ties, church, craft and gardening skills, all of which played important roles in making a good life and warding off the worst effects of occasional domestic disaster or economic downturn. I note, too, that my dad's people were from the Celtic fringe, Scotch-Irish who emigrated to America from northern Ireland. Lots of what Keith writes seems awfully familiar.
@John Conroy,

The lines from Federalist 1 that you note came as a whack on the side of the head, a Zen moment of disillusioned enlightenment, when I first read them seriously. It is, however, the ones that follow that have seemed to me a charter for an applied anthropology,

"The plan offered to our deliberations affects too many particular interests, innovates upon too many local institutions, not to involve in its discussion a variety of objects foreign to its merits, and of views, passions and prejudices little favorable to the discovery of truth."

How better to describe the anthropologist's contribution to policy debates that a professionally honed awareness,reinforced by research, of "particular interests...local institutions...and...views, passions and prejudices little favorable to the discovery of truth."

Keith, you wrote to me that: ‘You have read Stedman Jones on Webb and you prefer her secondhand evidence to my ... summary statement of something different’. And again, you wrote that ‘the idea that Manchester was clean (formal) and London dirty (informal) over a century ago is a gross geographism that even superficial reading of the relevant social and economic history would refute’.

In fact, I agree with you that, at least potentially, ‘people everywhere have plural sources of income on either side of the formal legal system’, and this is clear from a reasonable reading of my remarks. I was frank in admitting to my reliance on Stedman Jones (a secondary source) for my account of Webb’s views. I reported Webb’s account, as reported by Jones, of ‘clean’ Northern towns and ‘dirty’ London (to adopt your characterization of her argument). I interpreted it as referring to situations in which formal industrial employment was dominant (the north) compared with the unique situation (for mid-C19 England) of London and its large and highly visible informal economy, with rampant casualization of labour. I pointed to the contrast between her impressions and your own account, which I paraphrased as involving ‘a range of activities in the north, conducted as sidelines by the formally-employed working class – and which, by implication, helped to sustain them during the period of open unemployment caused by the cotton famine’. I confessed to being ‘tantalized’ by the apparent discrepancy between these two views, and regretted that you had not (as I thought) written more extensively on the subject. This had a beneficial outcome – you unearthed a paper for us in which your ideas are spelt out at greater length.

May I suggest a means of resolving some of the confusion? Let’s leave Manchester out of it for the moment and consider contrasting London with any of a multitude of small and smallish industrial towns in the north at the time of Webb’s visit. The dominant mode of livelihood was formal employment at t’mill, as well as ancillary activity, but the countryside was near at hand and many mill-workers and others formally employed may have had access to ‘sidelines’ – a situation that was, by your account, still observable in Rossendale almost a century later. Let’s accept Webb’s account of the ‘outcasting force’ pushing ne’er-do-wells (my term) out of such towns and her related perception that the street-level manifestations of an informal economy (‘odd-jobs’) were scarce in them. Let’s recall that in your account of Nima and in Bauer’s generalized ‘British West Africa’ the practice of ‘moonlighting’ was common among formally-employed workers. Let’s grant that this may also have been important in the industrial north of Webb’s time. But here I suggest that the difference lies in the absence from it (aside from during the cotton strike and other depression periods) of an underclass wholly or substantially dependent on informal economic activity.

If so, there was a clear contrast to be drawn between the north and London – and you are no doubt correct to suggest that Webb did not see the ‘sideline’ occupations being pursued by many of the northern working class. When we bring Manchester (and Birmingham and other larger population centres) into the picture, I’m not sure how well my hypothesis would hold up. It would, as you suggest Keith, require a reading of ‘the relevant social and economic history’ – always assuming there were contemporary observers reporting credibly on the phenomena which interest us here today. It would be surprising if there were not at least some evidence of sidelines and moonlighting among the industrial working class (as you suggest) but also perhaps some semblance of an underclass and its street economy in a city so large as Manchester. How municipal authorities dealt with such an informal economy and how voluntary and official welfare institutions attempted to ameliorate it would no doubt have influenced its visibility, and perhaps also its size.



Keith Hart said:

Hi John,

I did write up the substance of my last comment in a review essay on Worlds of Indian Labour for Critique of Anthropology (2000) which I have uploaded here, since it would otherwise lie festering behind Sage's paywall.

I have spent many years reading, doing fieldwork and historical research on industrial Lancashire in the19th century, based partly on my experience of living there after WW2. This never matured into an independent published work, but then the same could be said of my Accra fieldwork in the 60s which exists today mainly in the form of soundbites from a couple of well-read articles. This review essay is as close as I ever got to expressing my dissatisfaction with conventional accounts of the industrial class system.

My central beef is with Marx and Engels who wanted to separate the factory proletariat from both the disorganized rabble and the small proprietors (lower middle class). The Webbs played their part in reproducing this intellectual system. My line is that workers have more sense than to rely exclusively on wage employment, even when they have it, since they know better than most academics what business cycles feel like for working people.

Maybe I have been too kind so far, but now the gloves are off. You have read Stedman Jones on Webb and you prefer her secondhand evidence to my admittedly summary statement of something different. How would she know as a teenage visitor what workers and the unemployed did in their spare time? I like her account of working class institutions which does go against the standard Marxist account. But the point is people everywhere have plural sources of income on either side of the formal legal system.

Phil pointed out that, from his perspective today, most London street traders work with and against the rules in quite complex ways. A tourist might not notice this as a mass phenomenon akin to Oliver Twist and Mayhew's London in the 1860s, any more than s/he would recognize the dodgy deals performed from the City of London. But the idea that Manchester was clean (formal) and London dirty (informal) over a century ago is a gross geographism that even superficial reading of the relevant social and economic history would refute.

Not to put too fine a point on it, I write of what I know from growing up in inner city Manchester after the war and living in Rossendale as an adult.



John Conroy said:

I’m going to look back to Keith’s last intervention, in the debate on the OAC forum, a week ago. I said then that I didn’t want to risk an anti-climax. But since the discussion has a new lease of life in the ‘Human Economy’ group I feel less constrained. So here goes!

John, I appreciated your account of a childhood perched liminally between formal and informal activity. If we want to summon up 'in living memory' data, i'm sure a number of readers from 'industrial' countries would be able to contribute.

a year or two back, here in Sydney the Australian Museum mounted an exhibition titled 'Skint', which featured material from the depression years of the '30s. There were still alive then plenty of people, now urbanites but who had grown up on semi-subsistent small farms and who had a range of 'bush' (= rural) artisan skills. These people crafted domestic furniture, hand made clothing and domestic implements for their own use during the depression. Needless to say there was a lot of home vegetable production, while rabbit trapping yielded meat for many and income from skins (in an age when men still wore hats). There were 'squatter' settlements on the sandhills of outer beach suburbs, composed of housing cobbled together from scrap building, materials, canvas and sacking.

The second world war restored full employment but also established domestic food production as a national objective, even in Australia, but particularly so in the UK (which was a substantial net importer of food before the war). Backyard food gardens proliferated and shortages due to rationing also stimulated other forms of non-market domestic production (as well as encouraging 'black' informal economic activity).

After the war, in a situation that would today be described as 'over-full' employment, Australia suffered a massive housing shortage as the population caught up on the low fertility of the 1930s. Building materials continued to be scarce but the availability of asbstos sheeting encouraged the 'do it yourself' creation of many greenfield suburbs with modest homes built at weekends by returning servicemen and others (with disease consequences now a national scandal, though that's a diversion from my story). So there is informal economy story in an industrial country with 2% unemployment, early post-war Australia.  



John McCreery said:

"It is surely essential to combine studies of the workplace with the institutions people devise outside it to meet their needs."

This line from Keith's review article resonates strongly with me, evoking, as it does, memories from my childhood that illustrate sources of the kind of resilience that Keith attributes to the Lancashire working class. The relevant background here is that my parents, who grew up in Savannah, Georgia, during the Great Depression moved to Virginia, where my dad went to the Newport News Shipbuilding and Dry Dock Company's apprentice school and became a master machinist. Three events shaped vivid memories for me.

1. My father wanted to live in the country. My maternal grandfather, a pharmacist with a drugstore in Savannah, provided the down payment that enabled the purchase of the place on which I grew up, located at the head of Patrick's Creek, which flows via the Poquoson River into Chesapeake Bay.my maternal grandfather later came to live with us, after being diagnosed with lung cancer and seeking treatment available in Virginia.

2. When my parents bought the place, the property included a large, ramshackle wooden house, have of which they rented to friends, who were careless with a wood stove, resulting in the fire that burned the place to the ground. While my mother, brother and I were sent to stay in Savannah, my paternal grandfather and my father's brothers came up to Virginia to build the new house, an enterprise in which they were helped on weekends by men from my parents' church. Women from the church came along, bringing casseroles, cakes and salads to feed the men and the kids who also came along to play in our big front yard while their fathers worked on the house.

3. During a slack period at the shipyard, when my father was laid off, I was largely unaware of what was going on. I did notice, however, that the vegetable garden got bigger, we started raising chickens and ducks, and we ate a lot of fish, crabs and oysters from the creek in front of the house.

Obviously, our family enjoyed the benefits of a good deal of economic and cultural capital. We were never poor. But I read Keith's review and tick off what I remember, kinship ties, church, craft and gardening skills, all of which played important roles in making a good life and warding off the worst effects of occasional domestic disaster or economic downturn. I note, too, that my dad's people were from the Celtic fringe, Scotch-Irish who emigrated to America from northern Ireland. Lots of what Keith writes seems awfully familiar.


John Conroy said:

Keith, you wrote to me that: ‘You have read Stedman Jones on Webb and you prefer her secondhand evidence to my ... summary statement of something different’. And again, you wrote that ‘the idea that Manchester was clean (formal) and London dirty (informal) over a century ago is a gross geographism that even superficial reading of the relevant social and economic history would refute’.

John, thanks for your meticulous restatement of the problem. I have long known that we share far more on this topic than any differences. One of the differences between anthropology and economics is that the ethnographic tradition is a genre of realist writing based on foregrounding people's activities in the places where they live, whereas the latter is a species of thinking, generating ideas about what should be done to solve society's economic problems. I have tried to beat a path between these two intellectual models, but in the process the idea of an informal economy has become a focus of academic and policy discourse with the reality of people's lives often forgotten.



The concept whose history you have charted so ably in this paper is the offspring of this dialectic in a quite concrete way. I originally wanted to confront economists with my ethnographic evidence: I wrote about formal and informal income opportunities with an emphasis on the resourcefulness which many individuals bring to economic structures that appear to deny them any room for manoeuvre. Above all, I wished to argue that dominant ideas distorted the reality of life in places like Nima and development policy needed to take that into account. I insisted that formal and informal dimensions of economic activity were inseparable, but I contributed to the objectification of my argument by delimiting my inquiry to the "Third world urban poor" and even introducing class analysis through use of "sub-proletariat", a term I borrowed from my Manchester colleague Peter Worsley. Because of the delay in publication, I also borrowed the term "informal sector" as a header from the ILO Kenya Report. My subsequent reflections on the topic, after a gap of two decades, were aimed at correcting these impressions, by denying any limitations of class, geography or institutional setting and especially the notion of the informal economy as a social object rather than a dialectical relationship (informality perhaps) of widely variable historical application. The need for such clarification became increasingly obvious as the world economy was subjected to a regime of deregulation, casualization and corporate criminality.

The idea of an informal economy is still useful for comparative analysis and as a way of pointing to parallels between situations that might otherwise be considered to be very different. Thus Women in Informal Employment Globalizing and Organizing (WIEGO) have used the idea to draw attention to the preponderance of women in informal employment and to the similarity of their predicament in many disparate places. This has been particularly effective in getting the attention of multilateral institutions like the ILO, WTO, World Bank etc. They have long cautioned me against taking my deconstructive line too far in case it undermines this strategy. [Their site incidentally is one of the best sources for our topic]. Your work makes a different case for the concept's usefulness, as does that of Barbara Harriss-White and many others. Equally the number of its trenchant critics is multiplying. (Check out 
Kate Meagher, for example).

There are several trends that I would caution against, given my sense of having lost the original ethnographic impetus to my argument. One lies in the use of the term "informal sector" or even "informal economy" which suggests we are talking about a discrete phenomenon out there, like manufacturing or agriculture. A second lies in the emphasis on poverty which diverts attention from the commanding heights of the bureaucracy itself. A third consists in the potential for comparison to reify discrete social objects, whether of class or geography. Thus Manchester vs London may be a useful starting point for comparison, but it too easily obscures the interdependence of formal and informal employment in both places. The idea of an underclass has been pivotal in both rightwing and leftwing politics, but it too oversimplifies social reality in ways that often lead to wishful thinking.

Marx, Engels, Mayhew, Webb and Stedman Jones have all contributed to a story about how the organized working class shed its association with the urban underclass in order to shape mainstream politics. A contrast between the northern factory towns and London's East End c. 1870 serves that purpose. This is a useful comparison, but not if it diverts our attention from the persistent dialectic at work in both places. And Manchester was not just what this rosy picture suggests. A House of Lords inquiry into the legal use of physical punishment in 1870 found that in two-thirds of the counties of England and Wales it had virtually disappeared and in all but one of the rest was minor. The exception was Lancashire where resort to physical punishment by the authorities reached levels off the charts. An example, an 8 year old in a Salford workhouse being given 48 lashes of the cat-o-nine-tails for talking back to a supervisor. Why was violent repression so severe there? Why does the Manchester police force have a deserved reputation for racism, violence and corruption today? (In this respect it really does rival London's Met). This is not simply a story of unionists forming coops, brass bands and singing in chapel, but it is that too.

There are limits to an ethnographic and historical analysis which privileges the reality of people's lives and I have reached them here.

Keith, you wrote that in your original account of informality, ‘I insisted that formal and informal dimensions of economic activity were inseparable, but I contributed to the objectification of my argument by delimiting my inquiry to the "Third world urban poor" and even introducing class analysis through use of "sub-proletariat"’. And then again you wrote that ‘my subsequent reflections on the topic, after a gap of two decades, were aimed at correcting these impressions, by denying any limitations of class, geography or institutional setting’.

Instead you asserted ‘the notion of the informal economy … as a dialectical relationship … of widely variable historical application’.  Indeed, ‘the need for such clarification became increasingly obvious as the world economy was subjected to a regime of deregulation, casualization and corporate criminality’.

For my part, I’ve been careful to restrict my comments on your work to the early ‘delimitation’ of the concept to the circumstances of early-independent Ghana, because my primary interest is in the history of thought about ‘economic development’ in late- and post-colonial under-developed countries. As you say, organizations such as WEIGO find this early version of the ideas useful for comparative analysis of contemporary economies, while I certainly regard them as applicable to the present-day reality of Papua New Guinea.  I don’t reject your projection of the ideas onto a bigger and broader screen, on which are shown the more contemporary phenomena of ‘corporate criminality’ and ‘grand corruption’ (to use a term popularized, I think, by Transparency International and now adopted by even the World Bank – see http://www.economist.com/node/21534761 ). Eventually, when I come to write about contemporary PNG, I will find good cause to relate certain phenomena to your ‘big screen’ scenario of grand corruption.

I’m struck by your characterization of the ethnographic tradition as a genre of realist writing. Mulling over this I came across an account of the fifty year career of the writer David Cornwell (aka John le Carré) by Peter Love on Inside Story at http://inside.org.au/from-cold-warrior-to-tory-radical/ . You may not, of course, be prepared to consider the claims of le Carré to be considered a ‘realist’.

Love says of this ‘Tory radical’ that, ‘When the Soviet Union disintegrated it seemed that le Carré might have lost his raison d’être, but he disagreed. “If an era is dead, the genre faces a long and boisterous renaissance… The spy writer can turn to almost any corner of the globe, knowing for a certainty that the spooks, arms dealers and phony humanitarians will be there before him.” And so, Love continues, ‘As the bipolar certitudes of the Cold War adversaries dissolved, le Carré’s focus shifted to the clandestine alliances between mendacious governments, brutally acquisitive corporations and international criminal organisations. He has explored in forensic detail the shift from a tussle between liberty and tyranny to the anarchy of unrestrained, amoral power in a chaotic global capitalism’.

Such themes are explored in several more recent le Carré novels. For example, The Constant Gardener (2001) turns on the discovery of ‘recklessly injurious’ drug trials on Kenyan villagers and ‘a convoluted conspiracy involving a pharmaceutical company, a compliant aid organisation, a corrupt regulatory agency and compromised British bureaucrats’. In the most recent novel, Our Kind of Traitor (2010)

‘Dima is a senior Russian mafia operative involved in money laundering for the brotherhood. He has had a deadly falling out with his associates and wants to seek anonymous asylum for his family in exchange for information about the criminal networks that have enmeshed themselves in capital markets. The sums are so large that financial institutions, regulatory agencies and governments are secretly complicit in the laundering for fear that public exposure might imperil not only them but also an already fragile global financial system’.

Love concludes with an historical parallel which might appeal to you, Keith:

‘As David Cornwell, and several of John le Carré’s characters, rail against a corrupt and corrosive global capitalism and its accomplices, we can hear distant echoes of an older voice. Some of the things that Cornwell and le Carré’s characters say are reminiscent of William Cobbett’s tirades against early capitalist relations displacing ancient reciprocities, “stockjobbers” corrupting markets in the City of London, and pusillanimous governments betraying the interests of decent common folk of good conscience’.

Finally, I agree wholeheartedly with you that the ‘informal economy’ is not ‘a discrete phenomenon … like manufacturing or agriculture’. Informality is present in ‘manufacturing’, and in ‘agriculture’, together with and closely entwined around ‘formality’. For this reason I accept fully your comment about the interdependence of formal and informal employment. Finally, I accept your stricture on the too close identification of informality with poverty – though it was this relationship that brought me to the field in the first place and which continues to motivate me.



Keith Hart said:


John Conroy said:

Keith, you wrote to me that: ‘You have read Stedman Jones on Webb and you prefer her secondhand evidence to my ... summary statement of something different’. And again, you wrote that ‘the idea that Manchester was clean (formal) and London dirty (informal) over a century ago is a gross geographism that even superficial reading of the relevant social and economic history would refute’.

John, thanks for your meticulous restatement of the problem. I have long known that we share far more on this topic than any differences. One of the differences between anthropology and economics is that the ethnographic tradition is a genre of realist writing based on foregrounding people's activities in the places where they live, whereas the latter is a species of thinking, generating ideas about what should be done to solve society's economic problems. I have tried to beat a path between these two intellectual models, but in the process the idea of an informal economy has become a focus of academic and policy discourse with the reality of people's lives often forgotten.



The concept whose history you have charted so ably in this paper is the offspring of this dialectic in a quite concrete way. I originally wanted to confront economists with my ethnographic evidence: I wrote about formal and informal income opportunities with an emphasis on the resourcefulness which many individuals bring to economic structures that appear to deny them any room for manoeuvre. Above all, I wished to argue that dominant ideas distorted the reality of life in places like Nima and development policy needed to take that into account. I insisted that formal and informal dimensions of economic activity were inseparable, but I contributed to the objectification of my argument by delimiting my inquiry to the "Third world urban poor" and even introducing class analysis through use of "sub-proletariat", a term I borrowed from my Manchester colleague Peter Worsley. Because of the delay in publication, I also borrowed the term "informal sector" as a header from the ILO Kenya Report. My subsequent reflections on the topic, after a gap of two decades, were aimed at correcting these impressions, by denying any limitations of class, geography or institutional setting and especially the notion of the informal economy as a social object rather than a dialectical relationship (informality perhaps) of widely variable historical application. The need for such clarification became increasingly obvious as the world economy was subjected to a regime of deregulation, casualization and corporate criminality.

The idea of an informal economy is still useful for comparative analysis and as a way of pointing to parallels between situations that might otherwise be considered to be very different. Thus Women in Informal Employment Globalizing and Organizing (WIEGO) have used the idea to draw attention to the preponderance of women in informal employment and to the similarity of their predicament in many disparate places. This has been particularly effective in getting the attention of multilateral institutions like the ILO, WTO, World Bank etc. They have long cautioned me against taking my deconstructive line too far in case it undermines this strategy. [Their site incidentally is one of the best sources for our topic]. Your work makes a different case for the concept's usefulness, as does that of Barbara Harriss-White and many others. Equally the number of its trenchant critics is multiplying. (Check out 
Kate Meagher, for example).

There are several trends that I would caution against, given my sense of having lost the original ethnographic impetus to my argument. One lies in the use of the term "informal sector" or even "informal economy" which suggests we are talking about a discrete phenomenon out there, like manufacturing or agriculture. A second lies in the emphasis on poverty which diverts attention from the commanding heights of the bureaucracy itself. A third consists in the potential for comparison to reify discrete social objects, whether of class or geography. Thus Manchester vs London may be a useful starting point for comparison, but it too easily obscures the interdependence of formal and informal employment in both places. The idea of an underclass has been pivotal in both rightwing and leftwing politics, but it too oversimplifies social reality in ways that often lead to wishful thinking.

Marx, Engels, Mayhew, Webb and Stedman Jones have all contributed to a story about how the organized working class shed its association with the urban underclass in order to shape mainstream politics. A contrast between the northern factory towns and London's East End c. 1870 serves that purpose. This is a useful comparison, but not if it diverts our attention from the persistent dialectic at work in both places. And Manchester was not just what this rosy picture suggests. A House of Lords inquiry into the legal use of physical punishment in 1870 found that in two-thirds of the counties of England and Wales it had virtually disappeared and in all but one of the rest was minor. The exception was Lancashire where resort to physical punishment by the authorities reached levels off the charts. An example, an 8 year old in a Salford workhouse being given 48 lashes of the cat-o-nine-tails for talking back to a supervisor. Why was violent repression so severe there? Why does the Manchester police force have a deserved reputation for racism, violence and corruption today? (In this respect it really does rival London's Met). This is not simply a story of unionists forming coops, brass bands and singing in chapel, but it is that too.

There are limits to an ethnographic and historical analysis which privileges the reality of people's lives and I have reached them here.

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