ABSTRACT
In La Paz, the municipal government distinguishes between establishments with fewer than five workers and those with more than five workers. Those in the first category are subjected to flat tax rates, the level of which depends on rough estimates of invested capital, and those in second category are taxed according to monthly revenues. Official studies of the “formal” and “informal” sectors of the La Paz assume that registered small-scale firms constitute an upper stratum of the “informal sector.” Small-scale production has also not been studied with the same rigor or frequency as larger scale production because some of the work involved has not been considered important for many of the same reasons that women’s work is denigrated in economic analysis. Firms were interconnected through putting-out systems; rental or borrowing of space and machinery; complex division of labor among otherwise independent producers based on differences in skills and access to means of production; and partnerships involving various kinds of arrangements.
