The Influence of the Urban Informal Sector on Economic Inequality

  • Victor E. Tokman


Following Kuznets (1955), it is widely hypothesised that the shift of the labour force from agricultural to non-agricultural sectors would affect the secular income structure, widening inequality in the early phases of transition from pre-industrial to industrial economies, becoming stabilised for a while and narrowing inequality in the later phases. This behaviour is expected as the result both of a greater degree of inequality and of higher incomes per capita prevailing in the non-agricultural sectors. According to Kuznets’ estimates, inequality should increase until the weight of non-agricultural sectors reaches 60–70 per cent of the total labour force.


Family Firm Latin American Country Informal Sector Formal Sector Economic Inequality 
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© Frances Stewart 1983

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  • Victor E. Tokman

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