IDEAS home Printed from https://ideas.repec.org/a/spr/jecrev/v76y2025i4d10.1007_s42973-025-00212-w.html
   My bibliography  Save this article

Multi-dimensional informality and heterogeneity of microenterprises in urban Africa

Author

Listed:
  • Nobuaki Hamaguchi

    (Kobe University)

  • Hiroyuki Hino

    (Duke University
    Kobe University)

  • Charles Piot

    (Duke University)

  • Jiahan Yin

    (University of Illinois Urbana-Champaign)

Abstract

Drawing on a multidimensional framework, we develop the Composite Informality Index (CII) as a scalar measure capturing the degree of firm informality. CII outperforms both individual aspects of informality and binary formal–informal classifications in associating informality with firm performance. Our findings show that a positive entrepreneurial mindset is associated with more formal practices, while firms relying less on government tend to be more informal. Firm employment size is negatively correlated with CII. The relationship between CII and sales growth is inconclusive, while technology adoption and business partnerships play a more decisive role in driving growth. During the COVID-19 shock period, more informal firms demonstrated stronger sales performance. However, this advantage did not persist into the recovery phase, as the link between informality and post-shock sales growth was not statistically significant. Hence, higher informality does not necessarily confer greater resilience.

Suggested Citation

  • Nobuaki Hamaguchi & Hiroyuki Hino & Charles Piot & Jiahan Yin, 2025. "Multi-dimensional informality and heterogeneity of microenterprises in urban Africa," The Japanese Economic Review, Springer, vol. 76(4), pages 891-925, October.
    • Handle: RePEc:spr:jecrev:v:76:y:2025:i:4:d:10.1007_s42973-025-00212-w
    DOI: 10.1007/s42973-025-00212-w
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s42973-025-00212-w
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s42973-025-00212-w?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to

    for a different version of it.

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;

    JEL classification:

    • O17 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements
    • O55 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Africa
    • Z13 - Other Special Topics - - Cultural Economics - - - Economic Sociology; Economic Anthropology; Language; Social and Economic Stratification

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:jecrev:v:76:y:2025:i:4:d:10.1007_s42973-025-00212-w. See general information about how to correct material in RePEc.

    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.

    We have no bibliographic references for this item. You can help adding them by using 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.