The formal–informal dichotomy: Revisiting the debate on the agriculture–industry linkage

Saumya Chakrabarti

The Economic and Labour Relations Review, 2014, vol. 25, issue 1, 154-178

Abstract: Incorporation of the informal sector in the general Kaleckian framework of agriculture–industry linkage is the primary target of this article. We show that the agriculture–informal sector interaction is distinctly different from the agriculture–formal sector relationship. Although agriculture supports the formal sector only from the supply-side, it helps the informal sector by providing both demand- and supply-side inducements. Next, contrary to the general perception of formal–informal complementarities, we rather propose a fundamental conflict. This conflict arises in the presence of the food supply-constraint or the generic resource-constraint. Subsequently, with these theoretical perspectives, we show that policies that are beneficial for the formal sector, in fact, constrict the informal economy.

Keywords: Accumulation by dispossession; agriculture–formal sector linkage; agriculture–informal sector symbiosis; formal–informal conflict; Kalecki; resource-constraint (search for similar items in EconPapers)
JEL-codes: J21 O11 O17 O20 Q18 (search for similar items in EconPapers)
Date: 2014
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Persistent link: https://EconPapers.repec.org/RePEc:sae:ecolab:v:25:y:2014:i:1:p:154-178

DOI: 10.1177/1035304613517988

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