Advanced Search
MyIDEAS: Login

Urbanization and (in)formalization

Contents:

Author Info

  • Ghani, Ejaz
  • Kanbur, Ravi

Abstract

Two of the great stylized predictions of development theory, and two of the great expectations of policy makers as indicators of progress in development, are inexorable urbanization and inexorable formalization. Urbanization is indeed happening, beyond the"tipping point"where half the world's population is now urban. However, formalization has slowed down significantly in the past quarter century. Indeed, informality has been increasing. This disconnect raises a number of questions for development analysis and development policy. Is the link between urbanization and formalization more complex than what had been thought? What does this mean for policy? The first core section of this paper asks what exactly is meant by formality and informality. The second core section turns to processes of urbanization and asks how these processes intersect with and interact with the incentives to formalize. The paper examines why cities attract the informal sector and the role that urbanization plays in growth and job creation through both the formal and informal sectors. Cities generate agglomeration benefits in the informal sector, perhaps more so than for the formal sector. The third core section is devoted to policy. At the current conjuncture, agglomeration benefits make a strong case for urbanization as an integral part of development strategy, but concerns about jobless growth and about urban poverty require a focus on the informal sector.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://www-wds.worldbank.org/servlet/WDSContentServer/WDSP/IB/2013/02/26/000158349_20130226090524/Rendered/PDF/wps6374.pdf
Download Restriction: no

Bibliographic Info

Paper provided by The World Bank in its series Policy Research Working Paper Series with number 6374.

as in new window
Length:
Date of creation: 01 Feb 2013
Date of revision:
Handle: RePEc:wbk:wbrwps:6374

Contact details of provider:
Postal: 1818 H Street, N.W., Washington, DC 20433
Phone: (202) 477-1234
Email:
Web page: http://www.worldbank.org/
More information through EDIRC

Related research

Keywords: Population Policies; Labor Markets; Urban Slums Upgrading; Labor Policies; National Urban Development Policies&Strategies;

This paper has been announced in the following NEP Reports:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Mercedes Delgado & Michael E. Porter & Scott Stern, 2010. "Clusters and entrepreneurship," Journal of Economic Geography, Oxford University Press, vol. 10(4), pages 495-518, July.
  2. Zephyr, 2010. "The city," City, Taylor & Francis Journals, vol. 14(1-2), pages 154-155, February.
  3. Desmet, Klaus & Ghani, Ejaz & O'Connell, Stephen D & Rossi-Hansberg, Esteban, 2013. "The Spatial Development of India," CEPR Discussion Papers 9433, C.E.P.R. Discussion Papers.
  4. Auriol, Emmanuelle & Warlters, Michael, 2004. "Taxation Base in Developing Countries," IDEI Working Papers 292, Institut d'Économie Industrielle (IDEI), Toulouse.
  5. Dani Rodrik, 2011. "Unconditional Convergence," NBER Working Papers 17546, National Bureau of Economic Research, Inc.
  6. Duranton, Gilles & Overman, Henry G., 2006. "Exploring the Detailed Location Patters of UK Manufacturing Industries using Microgeographic Data," CEPR Discussion Papers 5858, C.E.P.R. Discussion Papers.
  7. Fields, Gary S., 1975. "Rural-urban migration, urban unemployment and underemployment, and job-search activity in LDCs," Journal of Development Economics, Elsevier, vol. 2(2), pages 165-187, June.
  8. J. Vernon Henderson, 2010. "Cities And Development," Journal of Regional Science, Wiley Blackwell, vol. 50(1), pages 515-540.
  9. Gundogan, Naci & Bicerli, Mustafa Kemal, 2009. "Urbanization and Labor Market Informality in Developing Countries," MPRA Paper 18247, University Library of Munich, Germany.
  10. Mercedes Delgado & Michael Porter & Scott Stern, 2010. "Clusters and Entrepreneurship," Working Papers 10-31, Center for Economic Studies, U.S. Census Bureau.
  11. Keen, Michael & Mintz, Jack, 2004. "The optimal threshold for a value-added tax," Journal of Public Economics, Elsevier, vol. 88(3-4), pages 559-576, March.
  12. Ejaz Ghani & William R. Kerr & Stephen D. O'Connell, 2011. "Spatial Determinants of Entrepreneurship in India," NBER Working Papers 17514, National Bureau of Economic Research, Inc.
  13. Ejaz Ghani & William R. Kerr & Stephen D. O'Connell, 2011. "Local Industrial Structures and Female Entrepreneurship in India," NBER Working Papers 17596, National Bureau of Economic Research, Inc.
  14. Matias Busso & Maria Victoria Fazio & Santiago Levy Algazi, 2012. "(In)Formal and (Un)Productive: The Productivity Costs of Excessive Informality in Mexico," Research Department Publications 4789, Inter-American Development Bank, Research Department.
  15. Overman, Henry G. & Venables, Anthnony J., 2010. "Evolving City Systems," Working Paper Series UNU-WIDER Working Paper W, World Institute for Development Economic Research (UNU-WIDER).
Full references (including those not matched with items on IDEAS)

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Ghani, Ejaz & Kanbur, Ravi & O'Connell, Stephen D., 2013. "Urbanization and agglomeration benefits : gender differentiated impacts on enterprise creation in India's informal sector," Policy Research Working Paper Series 6553, The World Bank.
  2. Glaeser, Edward & Joshi-Ghani, Abha, 2013. "Rethinking Cities: Toward Shared Prosperity," World Bank - Economic Premise, The World Bank, issue 126, pages 1-14, October.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:wbk:wbrwps:6374. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Roula I. Yazigi).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.