The European Journal of Development Research

, Volume 26, Issue 4, pp 397–418 | Cite as

Informal Employment and Development: Patterns of Inclusion and Exclusion

  • Martha Chen
Original Article


At present, there is renewed interest in the informal economy worldwide. This renewed interest has rekindled some of the old debates about the phenomenon. This article will address two of the core debates: first, whether or not the informal economy is linked to the formal economy and modern capitalist development; and, second, whether or not the informal economy is outside the reach of government regulation. In so doing, it will raise a third dimension largely overlooked in the debates: the exclusion of the informal economy in economic development planning, especially at the local level. The article concludes with reflections on the exclusion of informal employment in local planning (by government) despite its inclusion in global production (through the market) and a vision for more inclusive approaches to economic development that take into account the size, composition, contribution and dynamics of the informal economy today.


economics informal economy informal worker informal employment development urban planning 


Il y a actuellement un renouveau d’intérêt au sujet de l’économie informelle dans le monde. Ce renouveau d’intérêt a ravivé certains des vieux débats sur ce phénomène. Cet article se penche sur deux des débâts au centre de la polémique: tout d’abord, celui de savoir si l’économie informelle est liée à l’économie formelle et au développement capitaliste moderne, et, ensuite, celui qui se demande si le secteur informel est hors de portée des régulations gouvernementales. Ce faisant, l’article soulèvera une troisième dimension souvent mise de côté dans les débats: l’exclusion de l’économie informelle du processus de plannification du développement économique, en particulier au niveau local. L’article se clôture sur des réflexions à propos de l’exclusion de l’emploi informel dans la plannification locale (du gouvernement) en dépit de son inclusion dans la production mondiale (par le biais du marché), et apporte une vision pour des approches plus inclusives quant au développement économique qui tient compte de la taille, de la composition, de la contribution et des dynamiques du secteur informel de nos jours.


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Copyright information

© European Association of Development Research and Training Institutes 2014

Authors and Affiliations

  • Martha Chen
    • 1
  1. 1.Harvard Kennedy School, Harvard Graduate School of Design, WIEGO NetworkCambridgeUSA

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