Urban informality and building a more inclusive, resilient and green economy

This working paper brings together discussions of the green economy and climate change resilience, using the urban informal economy to anchor these concepts. It points out that too little attention has been paid to the role of urban informality in achieving a greener and more climate resilient economy. This is surprising, given the large proportion of people employed informally in low- and middle-income countries, as well as the world’s increasing level of urbanization. To fill this gap, the paper first defines the green economy and climate resilience concepts from an urban perspective. It then details the features of the urban informal economy, along with a discussion on schools of thought concerning it.

A key focus in this work is on inclusiveness: an urban informal economy that is not only greener and more resilient, but also more inclusive. This encompasses equitable gender relations, attention to informal settlements, and other aspects that should be heeded if the urban informal economy is to be truly just. The 2013 collapse of the Rana Plaza garment factory in Bangladesh, leading to the deaths of over 1,100 informal employees, is a tragic reminder of the vulnerability that can result when economic informalization is exploited.

The paper draws out priorities for both research and action. The recommendations are grounded in a recognition of what is actually happening in urban informal economies, where regulations are often ineffective and exclusionary; where there are major differences between green and resilient activities and ones that are damaging; where links with the formal sector abound and should be taken into consideration; and where plenty of entities are already working toward inclusion and environmental responsibility. The paper champions an approach that recognizes these distinctions and possibilities for collaboration. One way forward, it suggests, would be to apply the principles of inclusive urban planning.

Available at http://pubs.iied.org/10722IIED.html

Further reading:

Benson, E et al. (2014), “Informal and Green: the forgotten voice in the transition to a green economy”, IIED Sustainable Markets Discussion Paper, IIED, London, available at http://pubs.iied.org/pdfs/16566IIED.pdf.

Rogerson, C M (1996), “Urban poverty and the informal economy in South Africa’s economic heartland”, Environment and Urbanization Vol 8, No 1, pages 167–179, available at http://eau.sagepub.com/content/8/1/167.abstract.

Book note prepared by Christine Ro