A research report submitted to the Faculty of Commerce, Law and Management, University of the Witwatersrand, in partial fulfilment of the requirements for the degree of Master of Management specialising in Entrepreneurship and New Venture Creation Johannesburg, 2016 / The establishment and growth of informal traders in South Africa have been attributed with a considerable need and desire for these informal economies to achieve economic growth, create sustainable entrepreneurial opportunities, assist with employment opportunities, etc. A number of factors have an impact on how these informal traders can become competitive and formalised, and one of these enablers is the influence of ICT interventions by informal economies to improve business performance. The purpose of this research was to establish the perceived relationship between the influence of ICT usage by informal traders and the perceived impact on business performance. The intended objective was to assess whether the perception of ICT adoption by informal traders had a positive or negative business performance outcome. The research methodology adopted was a quantitative approach, which was guided by a positivist paradigm. The population targeted were informal traders in the Sandton region of Johannesburg, South Africa. A questionnaire was distributed to gather data. The influence of ICT and the perceived impact within informal traders in the Sandton region revealed some findings consistent with existing literature. It was the overall accepted perception that ICT adoption has a perceived positive impact on business performance, including but not limited to market share, products, and customer service, as measured in the research. A deeper analysis is required to understand why the respondents in the research overwhelmingly state that the influence of ICT adoption has a perceived positive impact on performance, market share, and product and customer service. / MT2016

Thesis presented for the degree of Doctor of Philosophy in the Faculty of Humanities, at the University of the Witwatersrand, July 2017 / Just over ten years ago on night of the 28th of August 2006, angry mobs took to the streets of Masiphumelele township outside Fish Hoek, near Cape Town, and attacked and looted foreign national spaza shops in the neighbourhood. The attacks shocked the city, and prompted the provincial government to initiate an intervention to address the underlying causes of the violence. The outcome comprised an agreement between foreign national and South African spaza shopkeepers that permitted foreign nationals to return on condition that they did not open any new shops in the township. These mediation efforts comprised the beginning of many governance interventions in Cape Town and across the country that were aimed at curtailing foreign national spaza shops in South Africa. This thesis examines formal and informal attempts to govern foreign national spaza shops in South Africa, and seeks to understand what they reveal about the nature of politics in South Africa, as a postcolonial and developing country. In doing so it locates itself in the theoretical framework of law and society, as it examines legal phenomena from a social science perspective. Its findings are based on case study methodology involving qualitative interviews with key participants and stakeholders, as well as document collection, participant observation, and media reports. The research finds that many governance actors’ anxieties towards foreign national spaza shops relate less to shopkeepers’ particular activities and more to South African traders’ abilities to incite local socio-economic discontent against these shops, and thereby threaten political establishments. However, governance interventions rarely unfolded as intended due to resistance by competing interest groups who sought to advance their private economic concerns rather than public and political rights. This invokes features of Hannah Arendt, Michel Foucault and Giorgio Agamben’s theories of the ‘social’ or ‘biopolitics’, which argue that the entry of economic concerns into the political sphere is characteristic of the modern age. The thesis therefore reflects on Arendt, Foucault and Agamben’s theories in assessing what governance efforts reveal about the nature of South Africa’s political sphere. It finds that the social realm in South Africa differs from their accounts in two significant respects. First, the social sphere is conflicted between various economic goals – with parties seeking to foster basic life and sustenance, as well as to advance the emancipation of citizens from the colonial legacies of apartheid through economic mobility and opportunity. This makes finding a path to advance overall economic advancement in the country more difficult and contentious. / XL2018

Thesis (Ph.D.)--University of the Witwatersrand, Faculty of Commerce, Law and Management, Wits Business School, 2016 / Financial Inclusion seeks to overcome the friction that hinders markets from expanding access and use of formal financial products and services to a broad number of people. Despite the significant policy efforts and increased presence of formal financial service providers, the Ugandan economy still bears low levels of financial inclusion, especially in the rural areas. The finance growth and decision-behaviour theories substantiate the importance of understanding the psychological processes underlying observed individual judgments or choices regarding the use of formal financial services. Using Sen’s capability approach, this study examined the personal and societal capabilities that influence financial inclusion of individual financial consumers. Specifically, this study assessed whether the capabilities an individual possessed actually contributed towards their likelihood of financial inclusion. The hypothesized study relationships with financial inclusion were realized, following a positivist and quantitative approach using a cross sectional research design. The sample of 400 individuals to whom the survey questionnaire was delivered were drawn from two distinct regions of Central and Northern Uganda. The two regions represented varying levels of financial inclusion - high inclusion (urban Central) and low inclusion (rural Northern). In this study, besides the traditional regression models, structural equation modelling using Analysis of Moments (AMOS), were used to establish the causal relationships between the hypothesized study variables. The study results revealed that financial self-efficacy, financial literacy, social networks and the interaction of the personal and societal capabilities significantly contributed to an individual’s financial inclusion across the two regions. The results further revealed that the personal and societal capabilities independently, and when combined, contribute towards an individual’s financial self-efficacy. Through an assessment of the mediation effect, this study demonstrated how financial self-efficacy can boost individuals to confidently undertake financial tasks and decisions and consequently, financial inclusion in relation to their capabilities, respectively. The results provide support to Sen’s capability theory as a tool for explaining financial inclusion from a demand side perspective within the Ugandan context. / GR2018

This research project focused on understanding the narratives of women informal street traders in Warwick Junction, Durban. This is a diverse and vibrant trading community and the five women interviewed have been working in the area for many years. This means that these research participants offer a unique window in on the intersections between individual (psychological) realities and historical, sociopolitical and economic life. The project adopted a narrative approach, analyzing the ways in which 1) particular incident narratives (PINs) within each life narrative reflect key aspects of the life story and draw on narrative principles to convey this; 2) the ways in which narratives are interactively constructed between the researcher and participants in the interview situation; and 3) the relational construction of individual lives in networks of communities. The results highlighted the inherently interwoven nature of identity construction between individuals and the communities with which they associate. The overarching factors of poverty, gender and trauma were shown, in all three levels of analysis, as key elements that tied the women together through relationships of shared experiences. The stories that the women chose to share were strongly influenced by the presence and responses of the interviewer and the researcher and thus, the ways in which power, entrenched in history and culture, influenced the narratives became most evident. The ways in which the women connect and disconnect with relational others was shown to influence their sense of belonging within various communities, both real and imagined. This contributed to the women’s development of resilience and salient identities as cohesive communities were shown to be buffers against adversity and influencers in the construction of identity.

Este trabalho estuda a relação entre a formalização das firmas, detentoras de licença municipal ou estadual, e a formalização de seus empregados. Em função da simultaneidade entre os indicadores, utiliza-se o SIMPLES, que representa uma variação exógena na carga tributária relevante para as micro e pequenas empresas, alterando, portanto, os incentivos à formalização para essas firmas. Para avaliar essa relação, o estudo utiliza a base de dados da Economia Informal Urbana (ECINF) de 2003, disponibilizado pelo IBGE em parceria com o SEBRAE, sobre micro e pequenos negócios em áreas não rurais no Brasil. Os resultados indicam que firmas com licença que poderiam aderir ao SIMPLES apresentam um impacto positivo e estatisticamente significante sobre a probabilidade de formalização dos empregados. / This research studies the relationship between the formality of the enterprises, processing state or municipal license, and the formality of their employees. As result of the simultaneity between the indicators, it is used the Law of the Integrated System of Payment of Taxes and Contributions of the Micro and Small Enterprises (SIMPLES), that represents an exogenous variation on the tax burden that matters to micro and small enterprises. Therefore, modifying the incentives to the formality to these firms.. To analyze this relationship, the study uses the data base for Urban Informal Economy (ECINF) of 2003, available by IBGE in partnership with SEBRAE, about micro and small enterprises in non rural areas in Brazil. The results demonstrate that firms with license that could be benefited by SIMPLES show a positive impact and significant statistically on the probability of formalization of the employees.

O ponto de partida para o desenvolvimento deste estudo é a existência de segmentação na produção aqui entendida como contínua diferenciação de atividades produtivas – de formas de organizar a produção e o trabalho, de processos produtivos e de trabalhos e de atributos requeridos para exerce-lo – e com este pano de fundo conceitua-se o termo Setor Informal e desenvolve-se o quadro metodológico que irá originar um conjunto de elementos empíricos sobre os trabalhadores no Município de São Paulo em 1980. O Setor Informal é aqui associado com as formas de organizar a produção, que não tem como motor o trabalho assalariado, ou seja, considera-se Setor Informal como o conjunto de produtores que, de posse dos meios de trabalho, desenvolvem suas atividades baseadas na própria força de trabalho. O quadro metodológico, por sua vez, foi desenvolvido com a finalidade de refletir espectros de formas dos indivíduos participarem da produção – proprietários, assalariados e trabalhadores por conta própria - , qualificados por aspectos referentes: requisitos para o trabalho – idade, sexo e escolaridade –, condições de trabalho – vínculo jurídico, qualificação, horas trabalhadas e tempo de permanência no posto de trabalho ou atividade – e níveis de renda. Decorre da análise empreendida, dos elementos empíricos coletados, bem como dos testes hipotéticos aplicados, que não se pode afirmar serem os trabalhadores informais, sob a conceituação aqui adotada, proporcionalmente a massa de trabalhadores que detêm os mais baixos requisitos e as piores condições de trabalho e níveis de rena no Município de São Paulo. Propostas de políticas de emprego e renda específicas para o Setor Informal não são priorizadas por este estudo, visto esse Setor ocupar espaço econômico intersticial e subordinado aos movimentos das firmas capitalistas. Além do que, no caso do Município de São Paulo em 1980, a maioria dos trabalhadores é assalariada e compõe parcela significativa dos que exercem o trabalho em condições e níveis de renda precários. Agrade-se à Financiadora de Estudos e Projetos (FINEP) e à Fundação Instituto de Pesquisas Econômicas (FIPE), cujo apoio financeiro possibilitou a elaboração desta pesquisa. Agradece-se também aos Profs. Drs. José Tiacci Kirsten – Coordenador do Projeto FINEP/IPE, Roberto Brás Matos Macedo – Orientador do trabalho de doutoramento, José Paulo Z. Chahad., Carlos Antonio Luque, Ana Maria Bianchi, Ivo Torres e Maria Elisete Licursi pelas leituras e discussões realizadas durante as etapas preliminares deste estudo. / The starting point for the development of this study is the existence of segmentation in the production, understood herein as a continuous fashion of differentiation in productive activities. With this background define the term Informal Sector and develop a methodological picture that will result in a set of empirical elements about the workers in São Paulo in 1980. The Informal Sector is herein related to the ways of organizing the production that do not have, as its drive, the work payed on the basis of wages. Therefore, the Informal Sector is considered as a set of producers that by possessing the means of work develop their activities in their own labour force. The methodological picture, was developed with the purpose of reflecting a spectrum of ways of individual participation in the production – owners, wage workers and independent workers – desegregated by specific work requirements – age, sex and education -, conditions – legal ties, qualification, hours worked and duration in the position in his job or activity – and income levels. Considering the empirical elements gathered and the hypothesis tested, one can not state that the independent workers – or the Informal Workers, under the definition adopted herein constitute the mass of workmen who are the unqualified and have the worst working conditions and income levels in São Paulo. Proposal concerning job policies and income policies which are specific for the Informal Sector are not emphasizes in this study due to the fact the refereed sector occupies and interstitial economic space and depends on the movements of capitalistic enterprises. We should also note that in the case of São Paulo in 1980, the majority of workmen work on a wage payment basis and make us a significant part of those who perform their works under precarious conditions and low income level.

The private sector in developing countries plays a key role in job-creation and is central to economic development and poverty alleviation. Governments around the world use various policies and regulations targeting firms in an attempt to foster growth. This dissertation focuses on the interplay between government policies, firm behavior, and labor markets in India. In Chapter 1, I study the impact of a location-based tax incentive scheme in India. Location-based policies that target particular geographic regions are widely used by governments, but there have been few rigorous evaluations of their causal impacts especially in the context of developing countries. Using aggregated and firm-level panel data, I find large increases in employment, total output, fixed capital, and the number of firms as a result of the program. These increases are due to both the growth of existing firms as well as the entry of new firms. There is supporting evidence that the new firms entering the treated regions are larger and more productive. I find no evidence for relocation of firms or spillovers in industrial activity between treatment and control areas. Finally, using data from household surveys, I show that wages of workers rise but find no changes in housing rents or migration across the treated and control regions. My results therefore suggest that the policy increased welfare, and I also conclude that the policy was cost-effective. This provides support for place-based policies to correct for regional economic disparities, especially in settings with low labor mobility. In the next chapter, I focus on the effects of a place-based policy on informal firms. The informal sector in India is a major component of economic activity covering more than 80% of the workforce. More often than not, the informal sector is beyond the ambit of tax authorities, hurting public finances in India. In Chapter 2, I study the impact of the federally financed location-based tax incentive scheme (studied in Chapter 1) on informal firms in India. Using a difference-in-differences approach with bordering districts, neighboring states, and major states as control groups, I find no evidence for increases in employment, total output, gross value added, and registration status for informal firms on average. However, separating informal firms into those that do not hire regular workers (Own Account Manufacturing Enterprises) and those that hire workers (Non-directory manufacturing enterprises/Directory Manufacturing Enterprises) reveals heterogeneous effects. I find that the policy change led to a higher likelihood of registration by NDME/DMEs but no effect on OAMEs. The policy change did not impact the size of these different kinds of firms. This chapter provides suggestive evidence that tax-exemption schemes can be a useful policy tool to incentivize informal firms to register. In Chapter 3, I revisit the contentious labor laws in India and their effects on hiring decisions of firms faced with demand shocks. Labor regulations in India differ by states and apply differently across types of laborers. The most restrictive laws make it harder to fire permanent workers for firms. However, these laws do not apply to workers hired through contractors (contract workers). Using firm-level data from India, I find that compared to firms in flexible labor regulations, those in more restrictive labor regimes hire more contract workers as a response to transitory local demand shocks. I find no differential response in hiring of permanent workers by firms faced with these shocks. This suggests that firms circumvent labor laws by hiring workers indirectly through contractors in the face of economic fluctuations.

Social security is one of the key pillars of socioeconomic development in developing countries. Despite being an internationally recognized basic right and a key pillar of socioeconomic development, it does not protect the majority of the global workforce. Over 90% of workers in developing countries do not have social security coverage, the greatest percentage belonging to informal sector. In Rwanda, the national government has stepped up efforts to extend coverage to the wider population, but informal sector workers have not joined the existing pension scheme in significant numbers, and the reasons for which are unclear. Guided by Maloney's theory of voluntarism; the purpose of this phenomenological study was to examine the factors affecting the level of workers' participation in informal sector in pension scheme in Rwanda. This study was designed to provide new insights into the current social security situation of informal sector workers in Rwanda and to contribute to the knowledge base on social security and the informal sector. The research questions focused on awareness, income levels, and other factors that can address the social security needs of informal sector workers. Data were collected from 22 active workers from informal sector and 5 officials from ministries and agencies who were well-versed with social security issues. Data were analyzed via Moustakas's steps of epoche, phenomenological reduction, imaginative narration, and synthesis of texture and structure. The results revealed that low incomes, lack of awareness, poor benefit design, distrust of public schemes, and frustrating laws and procedures were hindering the increased public pension coverage of informal sector workers in Rwanda. These findings will help Rwandan policy makers to promote positive social change by informing policies that enhance social protection of workers in informal sector.

Using a three-essay approach, I focus on two issues related to the labor market: the effect of changes in regulatory costs on informal sector employment, and the role of endogeneity in the relationship between education and earnings. In the first essay, I analyze the implications of regulatory costs on skill-based wage differences and informal sector employment. I use a two sector matching model with exogenous skill types for workers where firms have sector-specific costs and workers have sector-specific bargaining power. In general, there are multiple equilibria possible for this model. I focus on the equilibrium that best resembles the situation in the developing countries of sub-Saharan Africa and southern Asia. My results show that government policies which reduce regulatory costs decrease unemployment, earnings inequality, and the fraction of skilled workers in the informal sector. The different types of regulatory costs affect the skill premium differently and non-monotonically. In the second essay, I test the hypothesis of linearity in returns to education in the Mincer regression with endogenous schooling and earnings. I estimate the marginal rate of return to education using a polynomial model and a semiparametric partial linear model based on the standard Mincer regression. To perform the analysis, I use a control function approach for IV estimation with spousal and parental education as instruments. Results suggest that estimates not accounting for endogeneity understate returns at the tails of the education spectrum and overstate returns for education levels between middle-school and college. In the third essay, I empirically test the claim of Mookherjee and Ray (2010), based on a theoretical model of skill complexity, that "the return to human capital is endogenously nonconcave." I estimate the functional form of returns to education for India using a semiparametric partial linear model based on the standard Mincer regression. Marginal returns are estimated to test the nonconcavity of the functional form under both exogenous and endogenous schooling assumptions. My results show that the marginal rate of return declines during primary education and increases until high school, followed by stable returns for college and higher studies. However, the test of robustness of the functional form based on uniform confidence bands fails to reject the presence of nonconcavity in returns to education for India. This lends support to the claim of Mookherjee and Ray (2010).

No description available.