Informal Household Research Articles

Bank competition and household informal credit

This study examines the relationship between bank competition and informal household credit. Using data from four rounds of the China Household Finance Survey (CHFS), we find that increased competition among banks significantly reduces households' use of informal credit. To establish causality, we create a quasi-natural experiment based on the relaxation policy for city commercial bank branch expansion and obtain consistent results. We further uncover two mechanisms through which bank competition affects informal credit use: reducing interest rates on formal loans and improving financial literacy among households. Moreover, the heterogeneous analysis shows that higher-income and asset-rich households, as well as those residing in urban areas, are more negatively affected by bank competition in terms of informal credit access, whereas its influence on informal credit in agricultural production and medical expenses for households is not statistically significant. Overall, the results imply that fostering moderate competition in the banking industry can diminish the reliance on informal credit markets and offer a more comprehensive understanding of the relationship between the banking sector and household credit.

Religion and household borrowing: Evidence from China

This study investigates the effect of religious beliefs on household borrowing behaviors from theoretical and empirical perspectives using microdata from the China Family Panel Studies (CFPS). The empirical results reveal that religious beliefs significantly increase households’ willingness to borrow. After propensity score matching, panel-fixed effect, instrumental variables regression, and robustness checks, the positive relationship remained. The mechanism analysis revealed that religious beliefs promote household borrowing by enhancing social networks. The effect of religious beliefs on household borrowing is more significant in rural areas with low income and low cognitive ability, but mainly promotes informal household borrowing, indirectly providing evidence of the underlying mechanism. Thus, this study plays an important role in guiding residents to hold reasonable religious beliefs and highlights the role of informal institutions in promoting the smooth development of the lending market.

The informal carer experience during the COVID-19 pandemic: mental health, loneliness, and financial (in)-security

Abstract Informal caring is associated with many negative outcomes. COVID-19 caused societal disruption, which may have disproportionately impacted carers. Reducing inequalities requires knowing whether, and how, carers were impacted. COVID-19 Understanding Society survey participants who were informal household carers (IHCs) were matched with a non-IHC comparison group. Differences between the groups were assessed for mental health (measured using General Health Questionnaire, GHQ-12), loneliness, subjective financial security, whether behind with mortgage/rent payments or bills, household wealth changes, and whether receiving universal credit (UC). A total of 1617 IHCs were matched with 6684 comparators. IHCs’ GHQ-12 scores were 0.613 points higher; they experienced greater loneliness and worse subjective financial security. IHCs were significantly more likely to experience decreased household wealth and receive UC, but not to be behind with bills. IHC outcomes remained worse than comparators in September 2021. Spending longer caring, caring for a partner, and not being employed were associated with worse outcomes.

The Impact of Formalization Program on Informal Household Enterprises Performance: Evidence From a Quasi-experiment in Nigeria

The Impact of Formalization Program on Informal Household Enterprises Performance: Evidence From a Quasi-experiment in Nigeria

Confucian culture and informal household financing: Evidence from China's counties

A growing body of literature is investigating the social and cultural determinants of household financing activity. This paper examines the impact of traditional culture, specifically Confucian culture in China, on informal household financing at the county level. We find that Confucian culture has a significant and positive impact on informal household financing activity, and a higher degree of digitally inclusive finance can strengthen the positive relation between Confucian culture and informal household financing. This positive relation between culture and financing appears to be stronger in regions where Chinese traditional culture is well preserved and more pronounced in regions with a better business environment. Our study offers insights for policy makers, revealing the importance of the impact of cultural factors on informal financial activity in emerging economies based on their particular cultural traditions.

Quantification and characterization of recovered materials in the cycle of the informal household electronic waste dismantling in Buriram province, Thailand: A challenge towards sustainable management and circular economy.

The numerous amount of electronic waste (e-waste) has not been managed effectively resulting informal dismantling sites are being expanded in Thailand. The government attempts to improve the efficiency of an integrated e-waste management system, but baseline data of e-waste stream in informal sectors are insufficient. This research aimed to investigate the inflow and outflow of the materials throughout the informal e-waste dismantling processes at the well-known second-largest community in Buriram province during 2017-2018. To describe the quantities of dismantled materials, a material flow analysis was performed. The overall amount of e-waste taken to the community was estimated to be in the range of 1593-12,943 tonnes year-1. Valuable materials could be recovered at more than 90% (by mass) from fans, refrigerators, washing machines, microwaves and air conditioners. The amount of e-waste residue that the local administrative organization had to handle was up to 1144 tonnes year-1. The quantitative data retrieved from this study could provide a satisfactory equation for estimating the amount of separated valuable and non-valuable materials. Recyclable materials from dismantling have an economic incentive, e-waste dismantlers in a small and large household group that can earn approximately 798 and 1262 USD month-1 income, respectively. The notable e-waste characterization and quantification of recovered materials would be useful for improving the potential circular flow of e-waste in Thailand.

Rural women and chemical fertiliser use in rural China

This study examines the influence of women's decision-making role on chemical fertiliser use in developing and transition economies. We distinguish two types of women family roles, namely formal household head and informal household head, and examine their impacts and differences on chemical fertiliser use by using nationwide data from 75,923 Chinese rural households. The results reveal the following: (1) households with formal female head would use less chemical fertiliser; (2) households with informal female head would use more chemical fertiliser; (3) the impact of formal female household head is insignificant on fertiliser use intensity when the family's major agricultural income came from grain production. The influence of informal female household head is insignificant on fertiliser use intensity for those living in coastal areas. Based on these results, we recommend that empowering women to give them more authority in decision making, stronger supports and reunion of family members. This study may have great significance for reducing chemical fertiliser use intensity in countries that have experienced rapid urbanisation and massive rural-urban migration.

Informal household preparedness: methodological approaches to everyday practices

Despite increasing attention to individuals’ everyday lives in the literature on risk, few studies investigate household preparedness within the everyday life context. Preparedness is most often regarded as a predefined set of capacities for dealing with emergencies. This article presents methodological approaches for studying what I suggest calling informal preparedness activities that are performed as part of daily life in households. Starting with the assumption that everyday life is enacted through culturally and socially shared practices, it is argued that preparedness is interwoven into these practices. Contrary to studying preparedness as the degree to which households are aware of and act according to a formal definition of preparedness, informal household preparedness focuses on preparedness as embedded in the routinised practices that make up everyday life. The study of informal household preparedness is based on three methodological approaches that explore these practices: (i) Performance of everyday practices, where interviews that focus on performance ask questions about what practitioners actually do; (ii) materiality, where walk-alongs are used to connect performance interviews to the material surroundings; and (iii) visualisation, where the material aspects of informal preparedness are documented. These approaches were carried out in a study of Norwegian households’ management of and preparedness for electricity and Information and Communication Technology (ICT) infrastructure breakdowns. Addressing informal and formal preparedness activities expands our understanding of household preparedness and should help policy makers recognise the active role of households and their actual resources and constraints in future preparedness planning.

Selling labor-domain livelihood assets: A qualitative approach to non-subcontracting home-based garment workers in the Lao PDR

This article examines how informal household workers selling labor are domain of livelihood assets required as a means to make a living. It is argued that five types of assets are well established in the livelihood work of workers in the Lao PDR (Laos). Qualitative methods were used to collect data, including in-depth interviews with 20 key informants. Contextual content analyses were performed using the ATLAS.ti program. Our main findings indicate that two groups are differently involved in livelihoods work in Laos. The first group of home-based garment workers (kinship, combines, and self-employed) highly transformed the social assets, human assets, and economic assets to achieve their livelihoods. Even selling one's labor involves a high transformation of progressive assets into livelihood outcomes. The second group of home-based garment workers (neighboring and industrial outworkers) were poor at transforming capital assets to achieve livelihoods. Further obstacles including lack of employment opportunities, welfare, and labor protections lead to fluctuating incomes. Finally, the contributions of actively selling labor are presented in the context of the key elements of empirical evidence.

INFORMAL SECTOR AND URBANIZATION EXTERNALITIES IN VIETNAM

This paper investigates the impacts of urbanization on the productivity of informal household businesses in urban places of Vietnam. Urbanization externalities are measured by the diversity of industry, which are disaggregated from formal and informal sources, and city size. Results from the paper show that informal household businesses in urban places benefit from clustering with formal enterprises but not from informal firms in other industries. Furthermore, the concentration in large and dense urban areas does not bring benefits to informal household businesses. The results call for more attention on the urban planning towards the informal sector in urban places of Vietnam.

Formal and Informal Household Savings: How Does Trust in Financial Institutions Influence the Choice of Saving Instruments?

We investigate whether trust in different financial institutions influences the choice of saving instruments. Is trust a significant determinant of household saving behavior? How does trust in different financial institutions affect the composition of household savings? Using unique survey data for ten emerging market economies in Central, Eastern and Southeastern Europe, we show that trust in the financial system increases the probability of holding formal savings and the diversification among formal saving instruments. Trust in the financial system and in foreign banks are significantly associated with holding contractual and capital market saving instruments. Trust in the safety of deposit has the largest positive effect on bank savings. Trust in domestic banks increases the likelihood of holding formal savings the most and trust in foreign banks decreases holdings of informal savings the most.

Agglomeration Effects: Productivity of the Informal Sector in Vietnam

ABSTRACTThis paper investigates agglomeration externalities on the productivity of informal household businesses in Vietnam. Although the paper finds heterogeneous impacts of agglomeration on the productivity of informal firms between urban and rural settings and across industries, it is found that technology transfers are not an agglomerative force for the informal sector of Vietnam. The disaggregation of local scale externalities into city types reveals that the highest developed cities in Vietnam may either be low-quality agglomeration or go beyond their optimal scale for the informal sector in some industries.

Perceptions of Costs and Benefits of Informal-Formal Linkages: Market and Street Vendors in Accra, Ghana

This paper investigates how linkages between informal and formal economic segments benefit or impose costs upon informal workers, based on self-reported relationships of market and street vendors in Accra with the formal economy and its institutions and a World Bank study of informal household enterprises providing. Data from 15 focus groups and 150 vendors from Accra city center and non-central locations are analyzed in terms of vendors’ relationships to the value chain, non-governmental institutions, the government, and the macroeconomy. The latter two exert a strong, mostly negative influence on informal operators, offset to some extent by support from membership-based organizations and NGOs. Access to loans from microfinance institutions is viewed both as a positive and negative influence on vendors’ work. Despite few visible direct linkages between informal operators and formal firms, they are somewhat mutually interdependent as retailers and suppliers in the value chain. To take advantage of potential informal-formal synergies, government and other actors need to become more proactive toward facilitating, rather than denying, infrastructure, support services and adequate space for informal traders.

English

The indiscriminate use of pesticides in developing countries has impacted negatively on the environment and public health. Despite that informal households in Uganda carry a high pest burden, the safe use and disposal of pesticides is poorly studied. We determined the prevalence and pesticide use practices among the informal households in Mulago, a suburb of Kampala city. A cross-sectional survey was conducted among heads of informal households in Mulago II parish, using a semi-structured interview questionnaire. Out of the 56 households in the parish, twenty 20 household met the inclusion criterion for an informal household. Household heads were interviewed on the pest burden and the practices on safe use and disposal of pesticides. Data was analyzed using SPSSv21 software; the chi-square test was used for Univariate analysis. The mean pest burden per household was 4 ± 0.7 pests: mosquitoes 20 (100%), bedbugs 18 (90%; p < 0.001), rats and houseflies 16 (80%; p = 0.007), and cockroaches 15 (75%; p = 0.025). Most households, 17 (85%, p = 0.002) had used a pesticide within the last 2 weeks. The most commonly used pesticides were synthetic pyrethroid in form of aerosols 18 (90%) or insecticide coils 10 (50%) and organophosphate solutions 15 (75%). Pesticides were applied on walls 15 (75%; p < 0.001) and in open air 12 (60%; p = 0.086). Pesticides were stored in lockable cupboards in 6 (30%; p = 0.645) households. The use of pesticides was associated with having livestock, cost of pesticide and the burden of pest infestation. Informal households in Mulago parish have a high pest burden and usage of pesticides. The use, storage and disposal of pesticides are largely inappropriate. Public health interventions that promote the access to quality and safe use of pesticides at informal households are critical. Keywords: Prevalence, Pesticide Use, determinants of pesticide, Uganda.

Estimating informal household food waste in developed countries: the case of Australia.

Food waste is a global problem. In Australia alone, it is estimated that households throw away AU$5.2 billion worth of food (AU$616 per household) each year. Developed countries have formal waste management systems that provide measures of food waste. However, much remains unknown about informal food waste disposal routes and volumes outside of the formal system. This article provides indicative metrics of informal food waste by identifying, in detail, five of the dominant informal food waste disposal routes used by Australian households: home composting, feeding scraps to pets, sewer disposal, giving to charity, and dumping or incineration. Informal waste generation rates are then calculated from three primary data sources, in addition to data from previous Australian and UK surveys, using a weighted average method in conjunction with a Monte-Carlo simulation. We find that the average Australian household disposes of 2.6 kgs of food waste per week through informal routes (1.7 kgs via household composting, 0.2 kgs via animals, and 0.6 kgs via sewage). This represents 20% of Australian household food waste flows. Our results highlight that informal food waste is a sizable food waste flow from Australian homes, deserving of greater research and government attention. Our examination of the full extent of food waste by disposal mode provides waste managers and policy makers with clear disposal routes to target for behaviour change and positive environmental outcomes.

Non-Farm Entrepreneurship in Rural Africa: Patterns and Determinants

We are the first to provide a comparative empirical analysis of non-farm entrepreneurship in rural Africa, using the World Bank's unique LSMSISA dataset. This dataset covers six countries over the period 2005 to 2012. We find that rural enterprises tend to be small, informal household enterprises that provide predominantly goods and services to the local economy, and operate intermittently due to seasonality in farming. We furthermore establish that the likelihood of operating an off-farm enterprise depends on individual capabilities, household characteristics and institutional factors. While the results of some variables show consistency across the sample, we also find much heterogeneity, suggesting that rural entrepreneurship is also a response to country-level circumstances and policies. Although more than 50 years have passed since rural development was identified as a priority for African countries, rural entrepreneurship continues to fulfill mainly a risk-diversifying role. This may suggest that policies to foster effective rural-urban migration and wage employment in rural areas, have largely failed in Africa.

The informal sector wage gap among Vietnamese micro-firms

Based on unique firm survey data from 2009, this paper examines the wage differential between formal and informal manufacturing household enterprises in Vietnam. Using the Blinder–Oaxaca decomposition method, we investigate whether the wage gap is attributed mostly to differences in observable characteristics (the endowments) between formal and informal firms, or to variations in the returns to these characteristics (the unexplained component). The results show that average wages are 10%–20% higher in formal firms and that the majority of this gap is due to observable characteristics, in particular differences in firm size, workforce characteristics and location. Thus, traditional wage determinants seem to play an important role in explaining the higher wage returns in formal firms.

Emergent Innovation through the Coevolution of Informal and Formal Media Economies

Well-established distinctions between amateur and professional are blurring as the impact of social media, changes in cultural consumption, and crises in copyright industries’ business models are felt across society and economy. I call this the increasingly rapid co-evolution of the formal market and informal household sectors and analyze it through the concept of “social network markets”—individual choices are made on the basis of others’ choices and such networked preferencing is enhanced by the growing ubiquity of social media platforms. This may allow us to better understand sources of disruption and innovation in audiovisual production and distribution in wealthy Western markets that are as significant as those posed by informal practices outside the West. I examine what is happening around the monetization and professionalization of online video (YouTube, for example) and the socialization of professional production strategies (transmedia, for example) as innovation from the margins.

Right to food, right to the city: Household urban agriculture, and socionatural metabolism in Managua, Nicaragua

The ‘right to the city’ has been understood as the right of urban inhabitants to produce urban spaces, and has generally drawn on Henri Lefevbre’s work on the social production of urban space. This paper examines the socioenvironmental aspects of the right to produce urban space. The aim of the paper is to draw on and contribute to the literatures on urban political ecology and the right to the city by exploring the concept of the right to urban metabolism through an analysis of everyday food production and consumption in homes in an informal settlement in Managua. The article argues that the ecologies of informal household urban agriculture (primarily the cultivation of fruit trees) are a key way that marginalised urban inhabitants in Managua appropriate and produce urban space, and consequently, demand their rights to urban metabolism. Through the production of home ecologies based on physiological necessities and cultural food practices, households simultaneously challenge their exclusion from urban spatial practices and address the increasing insecurity of access to food in Managua.

Inside Informality: The Links Between Poverty, Microenterprises, and Living Conditions in Nairobi’s Slums

Summary Using households rather than enterprises as the analytical unit, this study of 1,755 households in Nairobi’s slums reveals that informal household microenterprises are indeed helping offset poverty. Microenterprises are helping households that are, a priori, more likely to be poor. Better microenterprise performance is associated with certain “business-related” factors, such as sales area, time in, and sector of operation. But “living conditions”—residential tenure and infrastructure access—also strongly influence both creation and success of microenterprises. Interventions that improve infrastructure and reduce tenure insecurity and rent-induced pressures to move may be crucial for incubating microenterprises and reinforcing their contribution to poverty alleviation in Nairobi’s slums.