Historicising the informal/formal dialectic: A reflection on the conceptualisation of informality versus the history of ‘informal’ economic activities

Abstract

The relationship between the ‘formal’ and ‘informal’ sectors has long been a topic of academic inquiry. Brandon Finn's paper which focuses on a case study of Zambia argues for a deeper historicisation of the formal/informal inquiry. In my reflections on Finn's paper I suggest that Zambia's lack of a pre-colonial urban tradition may create some limitations on the historicisation of ‘informality’ and the discussion might usefully be pushed beyond the historical boundaries of European colonialism to consideration of urban economic activities in pre-colonial and pre-capitalist states and their urban centres.

Introduction

The nature of urban processes in Zambia has been an important arena for academic debates about broad socio-economic changes in Africa and elsewhere for many decades (e.g. Ferguson, 1999; Larmer, 2017; Macmillan, 1993; Mitchell, 1954; Potts, 2005). The country's history as a colony without pre-colonial urban centres which, largely due to its copper resources, then developed into one of the African continent's most urbanised societies made it a textbook case for study (Potts, 2005: 589). Its subsequent shift into becoming the first African country to experience a period of de-urbanisation in the past two decades of the 20th century, as a result of the debt crises of the 1970s and structural adjustment programmes of the 1980s and 1990s (Potts, 2016), again brought it into the urban spotlight. The decade-long global commodity boom from around 2003 recharged the migration processes which raise urbanisation levels although fluctuating copper prices since have brought new national economic challenges, including a recent International Monetary Fund debt restructuring in 2023 (United Nations, 2023). Brandon Finn's paper about informality in Copperbelt cities (and presumably other Zambian cities such as Lusaka) and how this might inform theorising about the informal/formal dialectic is a welcome addition to this academic tradition.

My own work on urban African has generally been framed within a theoretical perspective which favours structure over agency and I am sympathetic to the arguments in Finn's (2025) paper for the importance of a structural understanding of the underpinnings of urban informality. He sees this in part as a counter to trends in some contemporary informal sector literature which focus on its quotidian aspects. Nonetheless, my research often focused on urban people's livelihoods, and I also appreciate the value of the approach cited of Simone and Pieterse‌ (2018: 39) that the important thing is to figure out ‘how things get done’. Or perhaps I would say that this is as important. It seems impossible to me to theorise about the nature of informality (vs. formality) without accounting for how complex and fluid people's livelihoods are, criss-crossing the definitional barriers. Many households engage in income-earning activities which straddle informal and formal sectors within cities, and some may further engage over periods of time with rural livelihoods. In my experience there is a preference for work in the formal sector because it tends to be better paid, although that is not a given, and the terms and conditions are hopefully better. However, realistically there is far more chance of gaining a livelihood in the informal sector in many African cities. Indeed, the sheer scale of informality in many cities of the Global South arguably gives the sector an important element of ‘agency’.

Which came first?

Finn's insightful paper covers a wide range of the debates and contestations over informality. In the rest of my commentary I pick out two interconnected elements which suggested issues I felt needed more consideration. One relates to Roy's (2005) well-established point that informality is created by the state (which can also unmake it). Finn, however, also points out that Hart, whose ideas were seminal in introducing the concept of informality to urban studies, was ‘influenced by Weberian notions of rationalization and the increased presence of the state in bureaucratic governance to ‘serve as a guarantor of an emergent corporate capitalism’’ (Finn, 2025, citing Hart, 1985: 56).

It occurred to me that this could be read to support a very different idea: that it was ‘formality’ that was created by the state. In turn, that could suggest that many of the activities understood as informal are those that pre-existed the defining of certain types of capitalist economic actors and production as formal. Could this mean that informality is (or became) much of what went before and continued on and around the new activities which were privileged by the state? This would be a counterpart to Roy's making and unmaking of informality – because it is also only the state which can make formality, by recognising and supporting those activities which emerge under capitalism with investors employing ‘free’ labour.

I believe there is a logic in this formulation. But it turns the more usual analysis on its head by acknowledging that many of the types of work, social relations of production, and economic activities now typified as ‘informal’ have been central to urbanism for millenia. They were not created by the colonial/capitalist state in a material sense – as Finn argues – but were re-identified conceptually. This tallies with the view of Davis (2017: 3, cited in Finn, 2025) that informality is a ‘relational condition: activities are classified as “informal” only in contrast to what is considered “formal”’. This requires that the ‘formal’ has itself been (or is being) established, even if not yet labelled. It was capitalism, with its creation of ‘free’ (and therefore mobile) labour, the development of new technologies enabling the mass scaling up of production and enhanced productivity, the sheer size of economic units and their associated labour forces, and the financialisation of the associated investments and profits, which created the ‘formal’ economic patterns which articulated with historical labour and production norms.

I think this helps to make sense of the ambiguous nature of the interactions between capitalist enterprises and their owners and the more longstanding production and work derived from ‘informal’ activity. If capitalist enterprises can benefit from active engagement (and probable exploitation) of the latter, or even dependence on its provision of services which keep labour cheaper, this is/was acceptable. Yet if the chance comes for the more organised and powerful sector to wrest new economic opportunities or boost profits by attacking ‘informality’, there will be a contestation. Given the states’ repositioning in colonial and post-colonial societies as a ‘guarantor of … corporate capitalism’, the ensuing struggles are highly unequal and usually favour the formal. My thoughts on this have been informed by Nici Nelson's (1988, 1997) outstanding studies on the informal livelihoods of women in Mathare Valley, Nairobi, which had long depended on buzaa (local beer) brewing and sales, when the Kenyan state decided to support the sale of beers produced by formal South African breweries. Buzaa sales in town had always been ‘illegal’ but compromises between the police and the sellers had allowed everyone to make money. In the 1990s, however, a new policing regime with outrageous fines and prison sentences was installed to drive the women out of business and remove their competition. An unplanned consequence was the bolstering of men's cooked meat sales. Nelson's (1997) key paper was aptly entitled: ‘How men and women got by and still get by, only not so well: the gender division of labour in a Nairobi shanty-town’.

More historicisation needed?

One of Finn's key aims is to provide a more deeply historicised explanation of informality informed by a structural perspective. He states that, ‘[a]ccounts of African spatial transformation, in Zambia and elsewhere, would benefit from looking beyond the demographic transition of the 1960s to understand how colonialism shaped and shapes contemporary urban conditions’ (Finn, 2025). I confess to being startled by this because there is a wealth of literature on the impacts of European colonialism on African urban forms and functions and their legacy for post-colonial nations. I was a little anxious to see myself seemingly cited to support the view that informality and ‘African urbanization is often framed as a post-independence phenomenon’ (Finn, 2025). This could not be further from the truth given my extensive work on processes of circular migration between rural and urban areas throughout the continent (e.g. Potts, 2010) which began under the aegis of colonial labour requirements for capitalist enterprises.

The reference to a ‘demographic transition of the 1960s’ suggests that, because rates of urban population growth tended to boom during this decade, this moment has overshadowed the impacts of earlier and later urbanising trends in the literature on informality. While this is sometimes true of many informal sector case studies on particular cities, the significance of colonial states’ attitudes towards urbanisation and migration remain important features of many more theoretical discussions about the nature of informality. However, more importantly, I felt that the temporal and spatial historicization of informality the paper calls for could usefully have been taken further. Finn does refer briefly to ‘the fact that African cities have a long pre-colonial history’. He also notes that the ‘dialectical conception [of the informal] in relation to the “formal” extends across both time and space … [and] encompasses precolonial, colonial, and postcolonial periods’ and even more explicitly states that ‘[i]nformality existed in pre-colonial Africa’. Nonetheless the salience of this for theorising about the roots of the informal sector is not pursued.

The problem is that, if the ‘informal’ existed during pre-colonial times, how can its roots be in ‘colonial spatial strategies’? As I noted above, livelihood practices and urban service provision exhibiting all the generalised features of ‘informality’, be this characterised by the nature of the activity or the conditions of work, are thousands of years old. This long history of urbanism calls into question Finn's assertion that ‘urbanization itself was and remains a legacy and mode of colonialism’. The more specific question is: how did people get by in historical Alexandria, or Amritsar, or Baghdad or Samarkand or hundreds of other urban centres across the territories of contemporary India and China or Latin America? The same question can be asked of the pre-capitalist populations and economies of more recent cities in Europe such as London or Vienna or Paris. Self-employment and family-based enterprises, itinerant traders, market workers, porters, waste-pickers, sex workers, food and drink producers and stalls, medicine women (and men), tailors, house-builders, water vendors and a host of other ways of getting by and allowing the city to function would be found in all such cities. In sub-Saharan Africa, therefore, we need to incorporate into our theorising similar types of economic activities which existed in pre-colonial cities like Oyo, Ibadan, Kumasi, Addis Ababa, Zanzibar, or Sofala. Were not the characteristics of many of these livelihoods essentially similar to some of those now deemed ‘informal’ as Tony O’Connor (1983: 139–141) argued in his book, The African City? Certainly many might now be identified as ‘informal’ but their roots long pre-date colonialism or capitalism.

The problem with using the Copperbelt and Zambia (and much of southern Africa) as starting points for theorising about the informal/formal dialectic is that the lack of pre-colonial cities makes the need to consider the sorts of questions asked above less apparent. While it is reasonable to argue that colonialism created urbanisation and both a formal and informal set of urban activities in Zambia, its specificity limits the theory's geographical reach. Must Finn's question, ‘Which states produce informality?’, be confined to colonial or capitalist states? The vast array of world cities with longer histories will have been dominated by modes of production other than capitalism and often several different ones over time, generating specific sets of urban social relations of production – such as slavery, feudalism, mediaeval trade guilds or earlier forms of colonialism under other empires (e.g. Roman, Mughal and Ottoman). The state (or at least the authority with the monopoly on violence) would have been involved in the enforcement of the social and economic norms of these modes: perhaps they might be deemed historical forms of recognised ‘formality’. A deeper historicisation of the concept of informality might therefore ask how, in such historical cities, quotidian urban livelihoods – those which were not embedded in the prevailing dominant mode of production – were viewed and treated by the state and interacted with more powerful economic actors.