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Epistemic reflections on the traditional perspective of the informal sector in developing countries: evidence of the failure of its transient predictions in Africa

Ganiyu R. A., Ademola A. A., Ani O. B.

Zeszyty Naukowe. Organizacja i Zarządzanie / Politechnika Śląska

2018

z. 119

67--83

Contrary to the predictions that the informal sector in developing countries, particularly Africa is marginal and exhibits tendency to disappear as most of these nations’ experienced satisfactory level of economic development. The informal sector has not only increased in intensity, it has grown to dominate economic activities in Africa countries. The purpose of this paper is to examine the epistemic reflections of the traditional view of the informal sector in developing countries vis-à-vis evidence of the failure of its transient predictions in Africa. To achieve the objectives of this paper, systematic review of literature on these issues were presented and discussed. The paper revealed that the growth of the informal sector has occurred in connection with declining competitiveness and productivity performance in Africa resulting to rising economic depression, growing unemployment and poverty level among others. Additionally, the informal sector has been generally neglected and has suffered severe discrimination in a number of important dimensions; hence, there is growing neglect and political will to propel the transition of the informal sector into formal economy. Against the aforementioned backdrops, the paper concluded that though, the informal sector is neglected, it has however, come to be a key components of the Africa economy. Similarly, against the apparent economic challenges presently ravaging most Africa countries, the informal sector will continue to gain popularity. On this note, the paper recommended the need to promote equitable linkages between the informal and the formal sector through appropriate inclusive policy framework with a view of increasing the wider development implications of the informal sector initiatives, as well as the political and institutional barriers that impede its activities and growth.