African Enterprise and the Informal Economy


An Autobiographical Note1

Keith Hart

The great invention of modern anthropology was fieldwork. For the first (and last) time, a segment of the intellectual class crossed the divide between themselves and the rest of society as a means of finding out how people live. This meant that they had to join their social objects as individual subjects, thereby muddling the conventional separation of subjects (‘thinkers’ working for those who take the decisions that matter) from objects (‘doers’ or those who perform the routine work of society). One of the main tasks of social science since its inception a century ago has been to maintain this division, squeezing the individuality of the unknown urban masses into impersonal categories suitable for manipulation by those who would control them. Anthropologists too aspired to professional status within the intellectual bureaucracy; and so their twentieth century practice was riddled with contradiction and confusion as they both joined the people and made objects of them.

The typical way of handling the problem was to keep the world of ‘fieldwork’ separate from ‘writing up’ back home, a task made easier by social and geographical distance in the colonial era. Whereas extravagant claims were made for the fieldworker’s subjective penetration of an exotic society (through active participation, learning the vernacular etc.), ethnographic reports were held to be strictly objective and scientific; and any comparison with realist fiction was denied, until quite recently.

The paradigm of scientific ethnography was already reeling from the blows inflicted by the end of empire and the idea of ‘primitive society’ as anthropology’s object was already moribund, if not quite dead, when I undertook fieldwork in Accra (and elsewhere in Ghana) from 1965 to 1968. No efforts were then made at Cambridge to draw students’ attention to the problem; and I was left to sort it out for myself as I went along. Aware that studying taxi drivers and pimps in a slum might not be considered anthropology proper, I chose a group of migrants, the Tallensi (Frafra), previously made famous by my head of department, Meyer Fortes (1949), in the hope that they would bestow on my work an air of classical orthodoxy.

Living in Nima, a sort of badlands on the outskirts of Accra, was something of an adventure and I was drawn into playing various social roles compatible, as I thought, with peaceful co-existence in that place. Since it was a violent and economically open society, I became by degrees a criminal entrepreneur – receiving stolen goods, money lending, illegal trading and the like. Towards the end of my stay, in order to redistribute the profits, I assumed the status of a local big man – throwing large parties, hiring many helpers, making handouts to old people, sorting out problems with the bureaucracy. Since I survived four arrests and several close shaves, I returned to write up my doctoral thesis with a feeling of considerable achievement. That was when my troubles began.

I never had any doubt that I wanted an academic job after my PhD. I now had to devise a form for reporting my fieldwork experiences that would be acceptable to my examiners. This meant writing myself out of the script, which did not seem all that difficult at the time. What I did not realise was that, in the guise of writing an objective report, I was deliberately embarking on unacknowledged fiction. Moreover, instead of asking myself how I learned what I did – through the reciprocal social relations I entered – I was obsessed with contributing to a body of theory in ‘the literature’.

Since this was the 1960s, the prevailing orthodoxy was ‘modernisation theory’. From this I took the congenial notion that development is the result of individuals struggling with traditional norms to institute modern practices. I called the men (and a few women) I was interested in ‘entrepreneurs’, since their economic activities impressed me most. Like a lone fieldworker inserting himself into a fast-moving society, they were individual subjects seeking to make their own way in a social setting that was in turn constraining and malleable. I stressed their individuality and the difference between the economic leaders and the rest of the migrant ethnic community. They were the stars, people whose careers changed the social map for the others. Much of my published material consisted of life histories.

For the next decade, like other ambitious young academics, I tried to turn my thesis into a book. I eventually gave up, only to return to the project – and fail again – not long ago. The reason, I told myself, was that I could not reconcile the big picture of what happened in post-war history with my own memories of fieldwork in Nima, especially since both were moving, perhaps together, perhaps not. Now I identify the problem as my failure to find an authentic voice, straddling uncomfortably the divide between subject and object, between the academy and life. I did attempt to ‘come out’ before, in Chicago a decade ago and once or twice since, and I was told that my confession would do irreparable harm to Anthropology Inc. Today I believe that silence is more harmful.

I was convinced that the chief deficiency of my ethnographic understanding was a weak grasp of the large forces shaping postcolonial history. Like the people I lived with, I felt that I understood well the mechanics of economic life on the streets; but, also like them, I had no idea why the world cocoa price had plummeted, precipitating shortages and an army coup, with far-reaching consequences for all Ghanaians. So I set out to penetrate the world of ‘development’, becoming a university lecturer, a consultant and an economic journalist. Initiation into this world came from joining an outfit at the University of East Anglia, where almost all my colleagues were development economists.

I soon learned that there was a lot of mileage to be had from assuming the role of a broker between disciplines, peddling anthropology to economists and vice versa. But I wanted to bridge the gap between the two, to link my fieldwork to the grand abstractions of development discourse. In other words, I sought to extend my subjective experience of Africa to a more inclusive level of society, the world of states and international institutions; and that meant convincing the economists that I had something to say that they could use.

I have long wondered about the poetry that has sustained ‘the informal economy’ as a long-running concept in the intellectual bureaucracy. At the very least it came out of my desire to reach the ‘masters of the universe’ with my words and theirs to make meaningful contact with the teeming hordes outside their hotel windows. The term I chose is negative, but polite; it names the unnameable, labelling the people by an absence, their lack of ‘form’, as understood by the bureaucracy. In any case, at a 1971 conference on ‘Urban unemployment in Africa’, I argued that the Africans I knew, far from being unemployed, worked for irregular and often low returns. I combined vivid ethnographic description (‘I’ve been there and you haven’t’) with some impressive – sounding economic jargon that I had worked out in conversation with my academic colleagues. I made no mention of my own economic activities.

Some members of my audience liked the idea enough to steal it; but my intellectual property rights were restored soon enough and I became known as the author of a whole new segment of the division of labour in development studies. Even more remarkable, despite the number of competing labels (second, hidden, underground, black etc), the ‘informal economy’ has become the term of choice in the economics and sociology of industrial countries. The poetry must be powerful indeed.

I was not overwhelmed by this success at first. Indeed I was only too aware that I had completed a thesis two years earlier using the language of entrepreneurship to analyse the same phenomena. Moreover, like many others in the early 1970s, I was undergoing a conversion to French Marxism; and the Marxists didn’t like the idea of an ‘informal economy’ at all. I set out to resolve my difficulties, as usual, by writing a paper about it (Hart 1975).

What I was up against was the social division between the bureaucracy and the people, between a state-made elite and the city mob, between the intellectual class and those they objectify; but it came out in an even more abstract form, as the conflict between individual and society. I started from the ideological polarity of the Cold War, economic individualism versus state collectivism. I recognised that this placed liberal proponents of ‘enterprise’ on the side of the individual and their Marxist detractors on that of the collective. I also realised that, by switching from an emphasis on entrepreneurs as persons to the ‘informal economy’, I had moved from the life of the slum to the air-conditioned offices of an international elite, sacrificing individuality to an abstract category that helped bureaucrats to understand and ultimately control others.

I set out to show that the grand oppositions of western theory had their counterpart in the concrete struggles of the people I had lived with in Nima. I argued that enterprising individuals could succeed in accommodating community interests, but often did not; so that recourse to positive and negative stereotypes (accumulation of wealth as a good or bad thing) was grounded in social relations and material conditions more than in ideology. Once again I excluded myself from the analysis; and yet it seems hard at this distance to separate my own struggles with society then from those of an ethnic ‘community’ with whom I was becoming increasingly out of touch.

Soon afterwards, I broke with the attempt to integrate my fieldwork experience with ideas about development. It is symbolic of an escalating detachment from normal social life that the only book I wrote as a result of my African research (Hart1982) had no people in it at all and addressed a topic, agriculture, of which I had no first-hand knowledge. Not so much a bird’s-eye view as one from a Boeing 747, the book was accepted by USAID as a consultancy report and by Cambridge University Press as a monograph in social anthropology. I thus succeeded in integrating the poles of my intellectual project at the level of ideas, formally detached from the people of Nima whose living company was the real source of any original thoughts I had come to be credited with.

In this way, I recapitulated the general betrayal of anthropology’s modern mission. Starting from a genuine commitment to ‘go and see for myself’, joining people in their everyday lives as a means of enlarging my knowledge of the world, I subsequently withdrew into academic bureaucracy and a career as an ideologue sustained by private ownership of intellectual work. (See Hart 2005) For the task of ideology is to make us believe that life is the outcome of ideas, rather than the other way round. It is gratifying to be famous as the author of an idea; but I know, and so should everyone else, that the idea of an ‘informal economy’ was a way of turning what is defiantly external to bureaucracy into something internal to it, incorporating the autonomous life of the people into the abstracted universe of their rulers.

In a recent paper (Hart 1992), I began the process of historical reconstruction that might allow us to discover the true significance of the ‘informal economy’ idea. It means going back to the Nkrumah coup of 1966, which I lived through in Nima, close enough to the main action in the presidential palace. From the perspective I now have on the post-war world, Ghana was and is an integral part of global society, not the distant, exotic place I found it to be then.

In the 1960s, society was everywhere identified with the state. Despite the crude oppositions of the Cold War, national capitalism was universal; which is to say that the task of economic development, the sole basis of political legitimacy, was assumed to be the primary responsibility of the state. The limits of this state dominance began to be revealed in the mid-1970s, to be followed by the Thatcher/Reagan experiment of combining private enterprise with enhanced state power and finally by the collapse of Stalinism. In the meantime, most of the ‘Third World’ has effectively dropped out of the world economy and governments there draw a thin veil of power over generalised misery. Now that the euphoria over ‘winning’ the Cold War has evaporated, the West is witnessing on its own home ground the last phase of national capitalism’s moral bankruptcy and economic exhaustion.

Africa was the last recruit to the twentieth century’s national capitalist system and its first victim. Ghana, the continental leader, had already, by the early 1960s, torn up the social contract between state and people that had animated the independence years. The military coup that ousted Nkrumah was based on recognition that, in a climate of economic failure, force rather than consent would now have to be the state’s explicit foundation. This was the situation I encountered as a fieldworker. I went to Ghana to study the political associations of migrants as citizens; but, in the face of political apathy, I soon turned to the economic vitality of the streets. That is, I followed the people of Nima who, knowing that they were excluded from (and victimised by) the state’s monopolies, were busy making lives for themselves in the cracks between. This early moment of what later became a general dialectic gave me insight into what people do when the state’s ‘macro-economics’ fail. In this sense, Ghana’s ‘informal economy’ was leading the world.

For it is indisputable that the drive to control society from the top (through governments, international agencies and large corporations) has over-reached itself since the Second World War. Informalization of the world economy has long been its most dynamic feature, with corrupt arms deals, the drugs traffic, offshore banking, political rackets, tax evasion and inner city crime uniting people at all levels of society. Civil society, the principled separation of public and private interests, has broken down and, as a consequence, the intellectual credibility of economics is in tatters.

One mistake I made in formulating the concept of an ‘informal economy’ was in treating the paired opposition, formal/informal, as static. In the early 1970s the polarities of the Cold War seemed inevitable and the state’s dominance was still taken for granted. So, although I recognized that the people were fighting back through their self-generated economic activities, I assumed that they were condemned to do so only in the minor interstices of society left unsupervised by an omnipotent state. The other mistake lay in sacrificing what was original in my fieldwork experience – relationships and personalities, the enterprise, the social experiments – for a mechanical worldview that could never see the embryonic democracy contained in these activities.

Things are different now. The old black market hustlers of the Brezhnev era are now riding BMWs round the streets of Moscow. ‘Enterprise’ is in favour once again. The collapse of the state is so far-gone in many countries (Jamaica and Zaire come to mind) that it hardly seems useful any more to point out that the ‘informal economy’ is dominant there. But what once seemed a kind of heroic resistance takes on a different odour when it is the only game in town. We are reminded what civil society was invented for, to do away with the mess of political corruption and economic violence that was normal then and now haunts us once again.

This leads me back to the Nima years, to ask what I really learned there that might be useful now, as ‘the informal economy’ concept no longer is. I began this process in a paper written for a seminar on trust (Hart 1988); and I will not rehearse the arguments here, beyond pointing out that much of my mature thinking on ‘African enterprise’ can be found there. I posed the problem once again in the form that it originally appeared to me: how do individuals project their enterprises into a future that is mediated by their social relations with others?

Frafra migrants lacked the kinship ties of their homeland and were excluded from state-sanctioned contracts; so they fell back on an ethos of friendship and trust that is quite well-suited to dealing in the short-term, but not to the organisation of production over time. Their dilemma is one we all share, namely how to insert our persons effectively into a world governed by impersonal social forces. It is out of the millions of individual responses to this dilemma that the social material of democracy and development must be emerging now, even as the world’s ruling powers prepare to hold off popular government at all costs.

But the main lesson I draw from my experience of fieldwork three decades ago concerns the actual social processes of learning to live in Nima that shaped so much of my future thinking and informs my academic practice today. Nima was a ‘no-go area’ for the police, who made occasional raids in force to pick up known criminals. I was a natural suspect as an informer whenever one of these raids took place. I was also under surveillance by the Special Branch who often harassed people I spoke to. Shortly before the 1966 coup I learned that I was on the list for deportation as a probable CIA spy. I was drawn into local society in a number of ways; but by far the most intriguing were the economic relations I was obliged to establish. I had to exchange currency; to pay rent; to hire employees; to negotiate with bureaucracy; to handle requests for loans and gifts. All of these transactions tested my basic assumptions about economic life. I discovered that, as a Manchester man, they went to the heart of what I considered society to be.

I never sat back and simply recorded how Frafra migrants thought the world works, their economic culture, if you like. Instead, I entered active relations with them in which my opinions were felt and often modified when I found out why my companions did otherwise. I had significant assets (money, contacts, knowledge) that were put to use; and I had to figure out how to cope with the social consequences, such as being arrested. This is how I became a criminal entrepreneur. Let us just say that there was an ‘elective affinity’ (Weber from Goethe) between my own proclivities and what Nima society really was. It seems pointless now to seek to distinguish one from another.

The true significance of all this was that I acted out anthropology’s modern project, to cross the boundary separating the state and intellectuals from the people. I had to make society, not from scratch, but under extremely alien circumstances; and the people who took me in helped me to find a way through the contradictions of our twentieth century world. I learned to integrate (only partially, of course) the divisions of race, class and culture that initially separated us. Above all, I found friendship and reciprocity in a grossly unequal world that placed a boy in a position of power over men twice his age.

I have spent much of the intervening period trying to make sense of that moment, soon after Ghana’s emancipation from colonial rule. I had to live in America and the Caribbean for many years; and I belatedly found the mentor I had been looking for in another world traveller, C.L.R. James (1992). From him I finally understood that modern world history is all of a piece; and I am now once again reaching out to Africa, this time as director of an African Studies Centre in my old university, hoping that Marx’s line on history repeating itself as farce might not apply this time.

When I made my original journey to Accra, I imagined that I was bringing world civilisation to the periphery. Since then Ghanaians have spread all over the globe, as just one part of Africa’s new diaspora, adding to old one formed by that earlier migration, ‘the middle passage’ of slavery. Accra has come to Cambridge, in numbers. Under these circumstances, ‘African Studies’ must be a collaborative enterprise, pooling the resources, knowledge and initiatives of Africans everywhere and their friends. The lessons of Nima, the difficult practice of equal exchange under unequal conditions, are not captured in marketable phrases; they live on in our faltering attempts to remake society.


Meyer Fortes 1949 The Web of Kinship among the Tallensi. Oxford: Oxford University Press.
Keith Hart 1973 Informal income opportunities and urban employment in Ghana, Journal of Modern African Studies, 11.3, 61-89.

  1975 Swindler or public benefactor? The entrepreneur in his community. In J. Goody (ed) Changing Social Structure of Modern
Ghana. London:
International African Institute, 1-35.
  1982 The Political Economy of West African Agriculture, Cambridge: Cambridge University
1988 Kinship, contract and trust: the economic organisation of migrants in an African city
slum. In D Gambetta ed. Trust: Making
and Breaking Social Relations
. Oxford: Blackwell, 176-193
1992 Market and state after the Cold War: the informal economy reconsidered. In R. Dilley ed. Contested Markets. Edinburgh:
Edinburgh University Press, 214-227.

1994 Entreprise africaine et l’économie informelle. In S. Ellis & Y. Fauré (eds) Entreprise et Entrepreneurs Africains. Karthala,
2005 The Hit Man’s Dilemma: or business, personal and impersonal. Chicago: Prickly Paradigm Press
2006 Bureaucratic form and the informal economy. In B. Guha-Khasnobis, R. Kanbur and E. Ostrom (eds) Linking the Formal and
Informal Economy: Concepts and Policies
. Oxford: Oxford University Press.

C.L.R. James 1992 The C.L.R. James Reader (A. Grimshaw ed). Oxford: Blackwell.

1 This text, lightly edited from the original, was published in French as ‘Entreprise africaine et l’économie informelle’ in Hart (1994). See also Hart (2006).


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