IDEAS home Printed from https://ideas.repec.org/a/sae/ecolab/v25y2014i1p154-178.html
   My bibliography  Save this article

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

Author

Listed:
  • Saumya Chakrabarti

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.

Suggested Citation

  • Saumya Chakrabarti, 2014. "The formal–informal dichotomy: Revisiting the debate on the agriculture–industry linkage," The Economic and Labour Relations Review, , vol. 25(1), pages 154-178, March.
    • Handle: RePEc:sae:ecolab:v:25:y:2014:i:1:p:154-178
    DOI: 10.1177/1035304613517988
    as

    Download full text from publisher

    File URL: https://journals.sagepub.com/doi/10.1177/1035304613517988
    Download Restriction: no
    File URL: https://libkey.io/10.1177/1035304613517988?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Ranis, Gustav & Stewart, Frances, 1993. "Rural nonagricultural activities in development : Theory and application," Journal of Development Economics, Elsevier, vol. 40(1), pages 75-101, February.
    2. Saumya Chakrabarti & Anirban Kundu, 2009. "Formal-Informal Sectors¡¯ Conflict: A Structuralist Framework For India," Journal of Economic Development, Chung-Ang Unviersity, Department of Economics, vol. 34(2), pages 27-67, December.
    3. Hymer, Stephen H & Resnick, Stephen, 1969. "A Model of an Agrarian Economy with Nonagricultural Activities," American Economic Review, American Economic Association, vol. 59(4), pages 493-506, Part I Se.
    4. Harvey, David, 2005. "The New Imperialism," OUP Catalogue, Oxford University Press, number 9780199278084.
    5. Amit Bhaduri, 2003. "Effective demand and the terms of trade in a dual economy: a Kaldorian perspective," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 27(4), pages 583-595, July.
    6. Lanjouw, Jean O. & Lanjouw, Peter, 2001. "The rural non-farm sector: issues and evidence from developing countries," Agricultural Economics, Blackwell, vol. 26(1), pages 1-23, October.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Kasturi Sadhu & Saumya Chakrabarti, 2021. "Neo-Dualism: Accumulation, Distress, and Proliferation of a Fissured Informality," Review of Radical Political Economics, Union for Radical Political Economics, vol. 53(4), pages 694-724, December.
    2. Saumya Chakrabarti & Anirban Kundu, 2009. "Formal-Informal Sectors¡¯ Conflict: A Structuralist Framework For India," Journal of Economic Development, Chung-Ang Unviersity, Department of Economics, vol. 34(2), pages 27-67, December.
    3. Hoang, Trung X. & Pham, Cong S. & Ulubaşoğlu, Mehmet A., 2014. "Non-Farm Activity, Household Expenditure, and Poverty Reduction in Rural Vietnam: 2002–2008," World Development, Elsevier, vol. 64(C), pages 554-568.
    4. Chakrabarti, Saumya & Kundu, Anirban & Nandi, Alok Kumar, 2011. "Farm–Non-Farm Linkage in India: A Structuralist Perspective," Indian Journal of Agricultural Economics, Indian Society of Agricultural Economics, vol. 66(2), pages 1-20.
    5. Jackeline Velazco Portocarrero & Trevor Young & David Colman, 2006. "Non-farm rural activities in a peasant economy: the case of the North Peruvian Sierra," Journal of International Development, John Wiley & Sons, Ltd., vol. 18(2), pages 207-221.
    6. Rijkers, Bob & Söderbom, Måns & Loening, Josef L., 2010. "A Rural-Urban Comparison of Manufacturing Enterprise Performance in Ethiopia," World Development, Elsevier, vol. 38(9), pages 1278-1296, September.
    7. Rijkers, Bob & Soderbom, Mans & Loening, Josef, 2009. "Mind the gap ? a rural-urban comparison of manufacturing firms," Policy Research Working Paper Series 4946, The World Bank.
    8. Paul Winters & Timothy Essam & Alberto Zezza & Benjamin Davis & Calogero Carletto, 2010. "Patterns of Rural Development: A Cross‐Country Comparison using Microeconomic Data," Journal of Agricultural Economics, Wiley Blackwell, vol. 61(3), pages 628-651, September.
    9. Emran, M. Shahe & Shilpi, Forhad, 2018. "Beyond dualism: Agricultural productivity, small towns, and structural change in Bangladesh," World Development, Elsevier, vol. 107(C), pages 264-276.
    10. Roehlano M. Briones, 2004. "Market Size, Differentiated Scale Economies and Interindustry Trade," International Trade 0412006, University Library of Munich, Germany.
    11. Pham, Hung T, 2006. "Rural Nonfarm Employment Under Trade Reform Evidence From Vietnam, 1993-2002," MPRA Paper 6476, University Library of Munich, Germany.
    12. Rajesh Bhattacharya & Ian J. Seda-Irizarry, 2015. "Re-centering Class in Critical Theory," Review of Radical Political Economics, Union for Radical Political Economics, vol. 47(4), pages 669-678, December.
    13. Elbers, Chris & Lanjouw, Peter, 2001. "Intersectoral Transfer, Growth, and Inequality in Rural Ecuador," World Development, Elsevier, vol. 29(3), pages 481-496, March.
    14. Lanjouw, Jean O. & Lanjouw, Peter, 1995. "Rural nonfarm employment : a survey," Policy Research Working Paper Series 1463, The World Bank.
    15. Alok Kumar, 2019. "Subjective Income Expectations and Risks in Rural India," Journal of Developing Areas, Tennessee State University, College of Business, vol. 53(3), pages 11-25, Summer.
    16. Ranis, Gustav, 2012. "Labor Surplus Revisited," Center Discussion Papers 133411, Yale University, Economic Growth Center.
    17. Shujaat Farooq & Zunaira Younais, 2018. "Do Non-farm Enterprises Offer Pathways for Upward Mobility in Rural Pakistan? Evidence from Panel Dataset," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 57(2), pages 203-221.
    18. Stein Kristiansen, 2003. "Linkages and Rural Non-Farm Employment Creation: Changing Challenges and Policies in Indonesia," Working Papers 03-22, Agricultural and Development Economics Division of the Food and Agriculture Organization of the United Nations (FAO - ESA).
    19. Velazco, Jackeline, 2003. "Non-Farm Rural Activities (NFRA) in a Peasant Economy: The Case of the North Peruvian Sierra," 2003 Annual Meeting, August 16-22, 2003, Durban, South Africa 25817, International Association of Agricultural Economists.
    20. Benjamin Davis & Paul Winters & Thomas Reardon & Kostas Stamoulis, 2009. "Rural nonfarm employment and farming: household‐level linkages," Agricultural Economics, International Association of Agricultural Economists, vol. 40(2), pages 119-123, March.

    More about this item

    Keywords

    Accumulation by dispossession; agriculture–formal sector linkage; agriculture–informal sector symbiosis; formal–informal conflict; Kalecki; resource-constraint;
    All these keywords.

    JEL classification:

    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O17 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements
    • O20 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - General
    • Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy; Animal Welfare Policy

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:sae:ecolab:v:25:y:2014:i:1:p:154-178. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: SAGE Publications (email available below). General contact details of provider: .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.