chapter  7
Planning and Informality
Pages 20

Early definitions such as that of the ILO focused on three of the key characteristics of informal enterprises, including those involved in house construction and service delivery: first, in each enterprise there is a substantial overlap between the provider of capital and the provider of labour; second, the sector consists largely of unincorporated enterprises that operate outside employment regulations and without acquiring non-labour inputs, such as licences; third, the sector is characterized by the small scale of enterprise operations and high levels of competition.3 Many studies and also official statistics adopt a definition that focuses on the second of these characteristics – the violation of formal state rules and regulations related to planning, building, employment, licensing, taxation, etc.