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GGRC45H3 (17)
Lecture 4

GGRC40 Week 4 Informality

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University of Toronto Scarborough
Michelle Buckley

GGRC40 Week 4 INFORMALITY Informal Sector:  Domestic households  Pawn shops – informal because it is not done by cash  Drug-dealing  Unauthorized employee  Prostitution  In some cities, street vendors are considered informal I. The quasi-legal or ‘grey economy’  Not completely illegal  That’s hidden from government regulation  Activities that include some mixture of formal and informal elements  Formal may be dependent on informal sector (we don’t necessarily see it) o Bribery  INDUSTRY CANADA II. Household Economy  System of resource allocation, system of training  Hidden economy that is not part of the GDP because women don’t get pension for being house workers  Formal economy relies on this type of household labour o Productivity of work depends on how well the work at home is being taken III. The Criminal or ‘black’ economy  Regulated by the government but in different ways  These are rendered ‘informal’ because the government prohibits them from being a part of the ‘formal economy’  RCMP and the POLICE involved in regulating  What types of drug dealing informal activity be connected to the formal economy? o Luxury market. People that are involved with organized crime. o Venues, ex. Restaurants (where drug dealing takes place) o Prostitution  Goes up during big events (formal economy)  Connected in terms of perks that high executives get o Child Labour  A lot of formal companies are involved with subcontracting work that hire child workers ***Pros and Cons of Informal Economy*** Is the informal-sector worker exploited by capitalist system or brave entrepreneur?  The film  Household economy and business have an interaction o Army of women creating the goods Why is work an important issue in thinking about megacities?  Huge demand for real estate and standard of living o Why megacities are expensive to live in  Poor are typically concentrated in the informal sector  Not only the poor make less and earn less, they tend to pay more as well o Pay lots of interest because of informal lenders Film 2: System D = Informal Economy o Less judgmental term than informal economy o 80% in Lagos working in System D o The total value of System D is 10 trillion a year o Next decade in a half, U.S.S.R (Not Russia) will catch up to the States at some point o Important enterprise of the world o Squatter communities growing faster than legal areas o Informal growing faster than formal o The answer to megacity liveability o We have to get used to the fact that economic activities are going to be coming from the informal economy o The informal economy will be one of the key si
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