The informal economy: a story of ethnography untold

By | January 8, 2011

There is no doubt that my life was transformed by the two and a half years I spent in Ghana, 1965-68, much of it doing ‘fieldwork’ in a slum of the capital city Accra. Writing a doctoral thesis was straightforward enough, although I felt I had to disguise my own participation in what I described. But I spent the next decade trying and failing to write a monograph based on it. I returned to the project again in the early 90s and failed once more. This book is the one I ended up writing to make sense of an experience that I have reflected on ever since. The movement of my work has been from ethnography to world history, but its origin in that moment over four decades ago is foundational.

When I started planning this book three years ago, I wrote an unbuttoned personal account of that fieldwork called Africa on my mind. Maybe something like it will find a place in the present version. Maybe not. But the point of this post is to trace how the idea of an ‘informal economy’ grew out of that ethnographic fieldwork. Forty years later, it seems to me that the concept stands in the way of understanding how Africa’s unregulated urban commerce might generate sustained development in the coming half-century.

I went to Ghana to study the transformation of rural-urban migrants into citizens by means of political parties, voluntary associations and public education. This was a time, the mid-60s, when western youth looked to the leaders of the anti-colonial revolution for political inspiration. In any case, Ghana was a police state and no-one wanted to talk about politics, even less do any publicly. On the other hand, in Nima where I chose to live, the streets were humming with freelance economic activity. So I decided to study that. When I returned to Cambridge, I was introduced to the American sociologist, Edward Shils, and he said “Ah, the Mayhew of Accra!”. I hadn’t heard of Henry Mayhew, but I soon found out. In fact I hadn’t read much at all, but I had a strong belief in the originality of my discoveries.

The people I chose to study included the Tallensi, made famous by their ethnographer, Meyer Fortes. He wanted me to stay on in Cambridge after my PhD, but I was reluctant to get drawn into the local coterie of Ghanaiologists. I felt that I knew Accra’s street economy as well as or better than the people themselves. But I was as ignorant as them about why the great events of the last couple of years had happened — the collapse of the world cocoa price, the consequent shortages, the military coup that ousted President Kwame Nkrumah, in short the beginning of a catastrophic economic downturn that lasted a quarter century or more.

Ghanaians bought large amounts of cloth from Manchester, my home town, but I had no idea how that came about. The world of ‘development’ that succeeded colonial empire was more or less a closed book to me. I knew that the historical political economy of West Africa’s situation a decade after independence could not be grasped by hanging out in bars or by reading anthropologists’ rather abstracted monographs. So I applied for and got a job in East Anglia’s Overseas Development Group which specialised in consultancy. My idea was to carry out ethnographic research at the level of states and international agencies and, from this beginning, I did just that over the next decade while I was failing to produce a fieldwork-based monograph.

This required me to talk to my colleagues, most of whom were economists. Our exchanges would go something like this:

Economist: Is the marginal productivity of agricultural labour zero in Northern Ghana?
KH: What does that mean?
E: I am thinking of Lewis’s dualistic theory of labour migration between traditional and modern sectors. It is assumed that people could leave the former without reducing total output there.
K: Does it make any difference what income they get from working in agriculture?
E: What do you mean?
K: Well, most of the farm work is done by young men, but their elders control the distribution of the product. So, if they leave to work in the towns, whatever they get there is their own and more than what they have at home.
E: What do you call that kind of organization?
K: Lineages or unilineal descent groups. A French Marxist, Pierre-Philippe Rey has written about the ‘lineage mode of production’ in West Africa.
E: And you say economists like jargon too much! There is a new version of the Lewis model by Harris and Todaro that hinges on rural-urban income expectations.
K: Maybe we should collaborate on an article, ‘The lineage mode of distribution: a reflection on the Lewis model’…

In this and other ways, I learned that I could make a satisfactory academic living by acting as a broker from anthropology to economics and back again. But I wanted to change both disciplines by synthesizing them. I realised that I would have to learn to communicate in the economists’ language, since they were professionally dominant in the field of development. So for three years I worked part-time as a journalist for The Economist, producing reports of West Africa. Through this work, I learned what I call ‘economese’ – how to sound like an economist without any formal training in the discipline.

This served me well, when I launched what became the concept of the informal economy in 1971-73 (the complicated story of this launch appears in several of my essays listed here under The African revolution). My original paper had two parts: the first was a vividly written ethnographic account of life in an Accra slum (I have been there and you haven’t); the second drew on my conversations with economist colleagues to present my argument in terms they could understand. What more can I say about the informal economy here? I was reluctant to accept that this would be my best-known contribution to the study of development. But it is and probably always will be.

I knew that I had sacrificed a lot of what I learned thrugh particiapnt observation to make an impact on the policy-makers. People’s lives were subsumed under huge collective abstractions. Now I want to return to that level of concreteness within a bigger picture than I was capable of at the beginning. In that sense, this is the book of my fieldwork long ago, but there won’t be much detail visible to readers since I have a lot of ground to cover.

4 thoughts on “The informal economy: a story of ethnography untold

  1. ryan anderson

    Sounds like a good project to me. I’ll be interested to read this when you’re done. Also, I definitely like the idea of acting as a broker between anthropology and economics–this is something that’s absolutely needed today more than ever. Especially when certain folks believe in the “magic” of the market so fervently.

  2. André Bojikian Calixtre

    Professor Hart, when I recently read your classical paper on Ghana to my mastering on economic development in Unicamp/Brazil, I didn’t got that you were trying to make a bridge between economics and anthropology as you mentioned above but to destroy a false interpretation of economic development theory that presumes an equal dissemination of welfare capitalism through the world as it becomes more and more integrated. I saw on your ideas a radical criticism on the so-called unity between rational economics and civilization. For when you revealed all that creative analytical categories for understanding Ghana society, such as the original concept of “informality”, it only makes you further distant from your economists fellows, specially the “lewisian” dualistcs ones.

    I’m very interested in “rescuing” this original feeling that I had reading your paper. It wold be a honor, and a pleasure, to speak with you by e-mail.

    Best Regards from Brazil

    PS: The dialog between the economist and you was very hilarious!

    1. keith Post author

      The goal of synthesizing the two disciplines was a long-term one, André. I felt it was too easy to impress with superficial knowledge of what others don’t know. In any case a synthesis would be critical of mainstream economics. My latest effort is a book with Chris Hann coming out next month.

      I had more modest goals for my paper. It was never my intention to coin a concept. That was achieved through the use of my ideas by the ILO Kenya report. I did want to intervene through my ethnography in the development economics of the day. This was concerned with an unemployment crisis in Third World cities, making some sort of parallel with the 1930s and putting the emphasis on the need to create real jobs. I argued that the picture would look different if economists had some way of factoring in what people were really doing. I did not distance myself from the neo-Keynesian approach of the day and was criticized by Marxists for that. I then had a Marxist conversion that lasted until perestroika, so I was not very interested in work on the informal economy then. I came back to it around 1990.

      I am very interested in your intepretation. You can reach me by dropping a line through Contact and I can reply by email if you prefer. But I would like to keep substantive exchanges public if possible. I will be visiting Brazil in May.

  3. Pingback: Everyday Africa and the theory of informality | Project Africa @ The New School

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