The informal economy is the part of the economy not monitored by governments. It does not necessarily break laws; it is simply not captured by standard government regulation. Common types of labour in the informal economy include domestic workers, home-based and street vendors, and informal employment in construction, farming and textiles. As the authors detail, innovation in this sector does not follow the classic science-and-technology-innovation (STI), but a doing-using-and-interacting (DUI) process of innovation. IP has been developed for STI, and is less adroit at protecting DUI; hence investigating the informal sector can give us fresh insights into the machinations of IP.
The book is a collection of chapters which build a comprehensive picture of the informal economy and innovation. Early chapters detail the evolution of the definition of the informal economy and statistics, and our current understanding. Later chapters examine country-specific studies in Kenya, South Africa and Ghana, and the final chapters bring the analysis into IP, innovation and policy.
|A picture of a man using a home-made welder for |
the jua kali sector in Kenya, Erik (HASH) Hersman
Turning to South African home and personal care products, Erika Kraemer-Mbula examines the production of products such as lotions, cosmetics and detergents. Kraemer-Mbula notes that South African apartheid limited opportunities for black entrepreneurship, thereby restricting the majority of the population. The informal economy emerged as the, "entrepreneurial response to the legislative limitations." Analysing survey data, the author finds innovations in improved formulations, packaging, process and quality control. 76% of surveyed manufacturers did not feel ownership of the ideas associated with their products. Yet, 80% have their own brand, and nearly half have of respondents use secrecy as a protection mechanism. As is often the case with small businesses, surveyed firms report low levels of IP awareness, or consider it "unsuitable" or "inaccessible." Kraemer-Mbula suggests strategies to support appropriation:
- Creation of industry associations
- Raising awareness of IP
- Promoting use of informal protection mechanisms
The Informal Economy in Developing Nations: Hidden Engine of Innovation?, edited by Erika Kraemer-Mbula, Sacha Wunsch-Vinceny, Cambridge University Press, 2016, ISBN 9781316798942, is available here for £100 in print, and $100 in e-book. Rupture factor: Medium, 400 pages.