Beyond the marginalisation thesis: evaluating participation in informal sector entrepreneurship

Abstract

This paper evaluates which entrepreneurs participate in the informal sector. Until now, the dominant view has been that entrepreneurs from marginalized groups benefiting least from the formal sector are more likely to do so. To evaluate this marginalization thesis, we report a 2013 survey of 11 Central and East European countries involving 707 face-to-face interviews with entrepreneurs about their participation in the informal sector. Using logistic regression analysis, the finding is that the marginalization thesis applies when examining characteristics such as the household financial circumstances and age of entrepreneurs engaged in the informal sector. However, when gender variations are analysed, the thesis is negatively confirmed. Meanwhile, no association is found when analysing characteristics such as the educational level, social class and area inhabited. The outcome is a call to move beyond the marginalization thesis and towards a more nuanced understanding of which entrepreneurs participate in the informal sector.

Why do Informal Sector Competitors Hinder Formal Entrepreneurs More in Some Countries?

“…Como o empreendedorismo do setor informal tornou-se uma subdisciplina proeminente no campo do empreendedorismo (Ferreira et al, 2019), a literatura sobre o tema tem se expandido rapidamente, especialmente em relação aos seus impactos no ambiente de negócios mais amplo (Afreh et al, 2019;Berdiev et al, 2020;Coletto & Bisschop, 2017;Dana, 2001Dana, , 2010Dana, , 2013Ilias et al, 2020;Khan & Quaddus, 2015;Mróz, 2012Omri, 2020Ram et al, 2017;Webb et al, 2009Webb et al, , 2013Williams, 2018). Até agora, foram realizados estudos sobre quais tipos de negócios participam do setor informal (Thai & Turkina, 2014;Williams & Horodnic, 2016;Williams & Martinez-Perez, 2014), se os proprietários são motivados por necessidade e/ou por oportunidades (Maloney, 2004;Perry & Maloney, 2007), a variada extensão em que as empresas operam no setor informal (Autio & Fu, 2015) e como explicar sua prevalência (Dau & Cuervo-Cazurra, 2014;Siqueira et al, 2016). Aqui, em primeiro lugar, o conhecimento emergente sobre a dimensão do empreendedorismo do setor informal é revisado e, em segundo lugar, a gama de teorias concorrentes para as variações entre países no empreendedorismo informal é empregada.…”

A decade of the <i>International Journal of Entrepreneurship and Small Business</i>: a bibliometric analysis

“…Specifically, about the informal economy, we can cite Sallah and Williams (2016) or Slutsky et al (2016) that, respectively, studied the role of the informal economy and tendencies of small businesses, both in developing countries, such as Sub-Saharan Africa or Arabia. Instead, regarding the theme of the informal sector, we can consider Williams and Horodnic (2016) that highlighted the necessity to overcome the traditional marginalization thesis to a broad analysis of the phenomenon of entrepreneurship in the informal sector.…”