Publication:
Informal Sector Dynamics in Times of Fragile Growth: The Case of Madagascar

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dc.contributor.authorVaillant, Julia
dc.contributor.authorGrimm, Michael
dc.contributor.authorLay, Jann
dc.contributor.authorRoubaud, François
dc.date.accessioned2017-05-30T22:19:39Z
dc.date.available2017-05-30T22:19:39Z
dc.date.issued2011-09
dc.description.abstractThis paper investigates the dynamics of the informal sector in Madagascar during a period of fragile growth. Overall, the behavior of informal firms in terms of earnings, employment and capital accumulation points to a degree of heterogeneity which goes beyond a simple dualistic model and even a more refined model that would distinguish between an upper entrepreneurial and a lower subsistence tier within the informal sector. However, in line with the dualistic model, the informal sector indeed fulfills a labor absorbing function in times of crisis. During the growth period authors see capital accumulation in most of the sectors and lots of evidence that households expand their activities. However, this happens mainly through the creation of new firms instead of the expansion of existing ones, which is consistent with much higher returns at very low levels of capital. More rapid expansion can be observed in sectors that operate with lower capital intensity, which is also consistent with risk or credit constraints as major deterrents to expansion. While there is some indication that total factor productivity increased over time, returns to capital and labor where not higher at the end of the observation period than at the beginning. Returns are also rather low at high levels of capital. These findings point to a limited growth potential of the informal sector as a whole. The heterogeneity in capital returns hints at large inefficiencies in allocating capital across informal firms.en
dc.identifierhttp://documents.worldbank.org/curated/en/357541468337172457/Informal-sector-dynamics-in-times-of-fragile-growth-the-case-of-Madagascar
dc.identifier.doi10.1596/26798
dc.identifier.urihttps://hdl.handle.net/10986/26798
dc.languageEnglish
dc.language.isoen_US
dc.publisherWorld Bank, Washington, DC
dc.rightsCC BY 3.0 IGO
dc.rights.holderWorld Bank
dc.rights.urihttp://creativecommons.org/licenses/by/3.0/igo
dc.subjectACCESS TO CAPITAL
dc.subjectACCESS TO CREDIT
dc.subjectACCESS TO FINANCE
dc.subjectACCESS TO FORMAL CREDIT
dc.subjectACCOUNTS
dc.subjectACCUMULATION RATE
dc.subjectADVANCED ECONOMIES
dc.subjectADVANCED ECONOMY
dc.subjectAGRICULTURAL ECONOMICS
dc.subjectBANK CREDIT
dc.subjectBANK POLICY
dc.subjectBARRIERS TO ENTRY
dc.subjectBIASES
dc.subjectBORROWING
dc.subjectBUSINESS ACTIVITIES
dc.subjectBUSINESS ACTIVITY
dc.subjectBUSINESS ASSOCIATIONS
dc.subjectBUSINESS ECONOMICS
dc.subjectBUSINESS OWNERS
dc.subjectBUSINESS RISK
dc.subjectBUSINESS RISKS
dc.subjectCAPACITY BUILDING
dc.subjectCAPITAL ACCUMULATION
dc.subjectCAPITAL CONSTRAINT
dc.subjectCAPITAL CONSTRAINTS
dc.subjectCAPITAL COST
dc.subjectCAPITAL COSTS
dc.subjectCAPITAL INJECTION
dc.subjectCAPITAL MARKET
dc.subjectCAPITAL MARKETS
dc.subjectCAPITAL REQUIREMENTS
dc.subjectCAPITAL RETURNS
dc.subjectCAPITAL SHORTAGES
dc.subjectCAPITAL STOCK
dc.subjectCAPITAL STOCKS
dc.subjectCHECKS
dc.subjectCOLLATERAL
dc.subjectCONTRACTUAL OBLIGATIONS
dc.subjectCOST OF CAPITAL
dc.subjectCREDIT CONSTRAINED FIRMS
dc.subjectCREDIT CONSTRAINT
dc.subjectCREDIT CONSTRAINTS
dc.subjectCREDIT HISTORY
dc.subjectCREDIT INSTITUTIONS
dc.subjectCREDIT MARKET
dc.subjectCREDIT MARKETS
dc.subjectCREDIT RATIONING
dc.subjectDEGREES OF RISK
dc.subjectDEMOGRAPHIC CHARACTERISTICS
dc.subjectDEVELOPING COUNTRIES
dc.subjectDEVELOPING COUNTRY
dc.subjectDEVELOPMENT ECONOMICS
dc.subjectDIVERSIFICATION
dc.subjectDUMMY VARIABLE
dc.subjectDUMMY VARIABLES
dc.subjectDURABLE
dc.subjectDURABLE GOODS
dc.subjectEARNINGS
dc.subjectECONOMETRIC MODELS
dc.subjectECONOMIC CONSTRAINTS
dc.subjectECONOMIC DEVELOPMENT
dc.subjectECONOMIC GROWTH
dc.subjectECONOMIC POLICIES
dc.subjectECONOMIC STATISTICS
dc.subjectENDOWMENTS
dc.subjectENTERPRISE PERFORMANCE
dc.subjectENTREPRENEUR
dc.subjectENTREPRENEURIAL ACTIVITIES
dc.subjectENTREPRENEURIAL ACTIVITY
dc.subjectENTREPRENEURS
dc.subjectENTRY BARRIERS
dc.subjectEQUIPMENT
dc.subjectEXCESSIVE RISK
dc.subjectEXPECTED UTILITY
dc.subjectEXPECTED VALUE
dc.subjectEXPENDITURE
dc.subjectEXPENDITURES
dc.subjectEXTERNAL FINANCE
dc.subjectFAMILY FINANCE
dc.subjectFAMILY LOANS
dc.subjectFARMERS
dc.subjectFEMALE ENTREPRENEURS
dc.subjectFINANCIAL MEANS
dc.subjectFINANCIAL RESOURCES
dc.subjectFINANCIAL SUPPORT
dc.subjectFIXED COSTS
dc.subjectFORMAL BANKS
dc.subjectGDP
dc.subjectGROUP OF FIRMS
dc.subjectGROWTH THEORY
dc.subjectHIGH INTEREST RATES
dc.subjectHOLDING
dc.subjectHOUSEHOLD WEALTH
dc.subjectHOUSEHOLDS
dc.subjectHUMAN CAPITAL
dc.subjectINCOME GROWTH
dc.subjectINFORMATION ASYMMETRIES
dc.subjectINFORMATION ON ENTREPRENEURS
dc.subjectINFORMATION ON INVESTMENT
dc.subjectINSTRUMENT
dc.subjectINSURANCE
dc.subjectINSURANCE MARKET
dc.subjectINSURANCE MARKETS
dc.subjectINSURANCE PRODUCTS
dc.subjectINTEREST RATE
dc.subjectINTERNAL FINANCE
dc.subjectINTERNAL FUNDS
dc.subjectINVENTORIES
dc.subjectINVENTORY
dc.subjectINVESTING
dc.subjectINVESTMENT BEHAVIOR
dc.subjectJOB CREATION
dc.subjectLABOR FORCE SURVEY
dc.subjectLABOR MARKET
dc.subjectLABOR MARKETS
dc.subjectLACK OF ACCESS
dc.subjectLEVEL OF RISK
dc.subjectLIQUID WEALTH
dc.subjectLIQUIDITY
dc.subjectLIQUIDITY CONSTRAINT
dc.subjectLIQUIDITY CONSTRAINTS
dc.subjectLIQUIDITY PREMIUM
dc.subjectLIQUIDITY PROBLEMS
dc.subjectLOAN
dc.subjectLOTTERY
dc.subjectMARGINAL COST
dc.subjectMARGINAL PRODUCT
dc.subjectMARGINAL UTILITY
dc.subjectMARGINAL UTILITY OF CONSUMPTION
dc.subjectMARKET CONSTRAINTS
dc.subjectMARKET ECONOMY
dc.subjectMARKET FAILURE
dc.subjectMARKET FAILURES
dc.subjectMARKET INTEREST RATE
dc.subjectMARKET INTEREST RATES
dc.subjectMICRO DATA
dc.subjectMICRO ENTERPRISES
dc.subjectMICRO-CREDIT
dc.subjectMICRO-ENTERPRISE
dc.subjectMICRO-FINANCE
dc.subjectMICRO-FINANCE INSTITUTIONS
dc.subjectMICROCREDIT
dc.subjectMICROENTERPRISES
dc.subjectMIDDLE INCOME COUNTRIES
dc.subjectMONEY LENDERS
dc.subjectMONEYLENDERS
dc.subjectMORAL HAZARD
dc.subjectOPPORTUNITY COST
dc.subjectOPPORTUNITY COSTS
dc.subjectPHYSICAL CAPITAL
dc.subjectPOLITICAL ECONOMY
dc.subjectPORTFOLIO
dc.subjectPRICE RISK
dc.subjectPRICE UNCERTAINTY
dc.subjectPRODUCTION FUNCTION
dc.subjectPRODUCTIVE INVESTMENT
dc.subjectPROFITABILITY
dc.subjectPURCHASING POWER
dc.subjectPURCHASING POWER PARITY
dc.subjectRATE OF RETURN
dc.subjectRATES OF RETURN
dc.subjectRECEIPTS
dc.subjectREINVESTMENT
dc.subjectRETAINED EARNINGS
dc.subjectRISK AVERSION
dc.subjectRISK PERCEPTIONS
dc.subjectRISK PREMIUM
dc.subjectRISK-AVERSE INDIVIDUALS
dc.subjectSAFE ASSET
dc.subjectSAVINGS
dc.subjectSELF-EMPLOYMENT
dc.subjectSMALL BUSINESS
dc.subjectSMALL ENTERPRISES
dc.subjectSMALL-SCALE ENTREPRENEURS
dc.subjectSOURCE OF CREDIT
dc.subjectSOURCES OF FINANCE
dc.subjectSTART-UP
dc.subjectTAX
dc.subjectTAXIS
dc.subjectTRADE SECTOR
dc.subjectTRADING
dc.subjectTRANSITION COUNTRY
dc.subjectTRANSITION ECONOMY
dc.subjectTRUST FUND
dc.subjectUNION
dc.subjectVALUE ADDED
dc.subjectWEALTH
dc.titleInformal Sector Dynamics in Times of Fragile Growthen
dc.title.subtitleThe Case of Madagascaren
dc.typeWorking Paperen
dc.typeDocument de travailfr
dc.typeDocumento de trabajoes
dspace.entity.typePublication
okr.crossref.titleInformal Sector Dynamics in Times of Fragile Growth
okr.date.disclosure2011-09
okr.date.doiregistration2025-05-05T11:56:07.656947Z
okr.doctypePublications & Research::Working Paper
okr.doctypePublications & Research
okr.docurlhttp://documents.worldbank.org/curated/en/357541468337172457/Informal-sector-dynamics-in-times-of-fragile-growth-the-case-of-Madagascar
okr.guid357541468337172457
okr.identifier.externaldocumentum000356161_20130524120156
okr.identifier.internaldocumentum17752757
okr.identifier.report77929
okr.importedtrue
okr.language.supporteden
okr.pdfurlhttp://documents.worldbank.org/curated/en/357541468337172457/pdf/779290WP0P1151000DynamicsMadagascar.pdfen
okr.region.administrativeAfrica
okr.region.countryMadagascar
okr.topicFinance and Financial Sector Development::Access to Finance
okr.topicFinance and Financial Sector Development::Debt Markets
okr.topicMacroeconomics and Economic Growth::Economic Theory & Research
okr.topicMacroeconomics and Economic Growth::Investment and Investment Climate
okr.topicPrivate Sector Development::Legal Regulation and Business Environment
okr.topicPrivate Sector Development::Microenterprises
okr.topicMacroeconomics and Economic Growth::Economic Conditions and Volatility
okr.unitSocial Protection and Labor
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