Decolonising Knowledge: Rethinking the Theoretical Trajectories of the Informal Sector

The discourse on urban informality has a rich history spanning more than five decades, marked by intense debates and controversies over its conceptualisation and management. These debates are anchored in theories historically shaped by Eurocentric paradigms, temporal shifts, and disciplinary biases. This chapter employs a theoretical and historical literature review to trace the evolution of informal sector theories, from their origins in economic and management scholarship to the ideological transformations that followed. The review reveals how these debates have generated multiple, often contradictory definitions, highlighting the inadequacy of dominant frameworks in explaining the complexities of informality in the Global South. While not dismissing existing theories entirely, the analysis underscores their misalignment with the socio-economic and cultural realities of diverse regions. The chapter argues that informal sector theories have passed through three phases (appearance, competition, and dominance) and anticipates a fourth phase, termed inversion, rooted in epistemic justice. To address the unique and dynamic informal economy, it advocates for context-driven theoretical models grounded in rigorous scholarship and aligned with the decolonisation of knowledge production.