 We have about 15 minutes, a little more, four questions and I'd also like to offer the opportunity if any of the three of you have questions for each other, just signal, because I think there's quite a lot to debate about there, I see. Is it on? Okay, I'm formal now. Good, thank you very much. It's really exciting presentations, all three, and very good introduction as well. So thank you very much for that. I want to ask about another couple of intersections, which I think could be really, really important for this and will be increasingly important. This has been about informality and formality in the work situation, but if you then compound it in terms of informal settlements, you know, the kind of slum dwellers and shack dwellers international agenda, it becomes even more complicated, because you might not just be vulnerable where you're working, but also where you're living, and that compounds it. And I wonder if the panel have comments on that. Secondly, whether you have comments on unpaid caring, because that's a huge burden on women and will increasingly become more and more. I saw a statistic which was so big that I didn't believe it, and because I didn't believe it I think I've forgotten it, but I think that by 2030 there are going to be another 100 million Indians who are over 65. And that means a huge additional burden primarily for women, unless there's a vast change in terms of male behavior. And then, Ravi, a question to you. Your typology, don't you also need a sixth category or additional categories for the firms that are playing international hide-and-seek and not just national hide-and-seek? Thank you. What we're going to do, because the questions are coming, I will take you, there's the lady there, and then some to you I'll go behind in the first round of three, and then I'll see you again in the next one. Thank you. Yes, thank you for these presentations. I'm particularly interested in the study of Ravi and the presentation on these categories. And I was wondering if you took into account the intersection of this informal sector with actually informal employment, as a lot of these, a lot of enterprises can be compliant for taxes and paying taxes, but hiring some workers formally and others informally. Or another scenario we see a lot in the Middle East is enterprises who oblige the workers before hiring them to under-declare their revenues so they pay less social security for them. Thank you. So thank you all three for very nice presentations. This is a question for Ravi on the very nice tax typology that you have. So the question here is, in many of these VAT regimes, the threshold says firms above the threshold are in the normal VAT regime, and firms below the threshold have a special regime, a separate regime, single tax or fixed percentage of sales or something like that. And then, my understanding, but sort of what your opinion is, they segment firms because firms below the threshold cannot sell to firms above the threshold because debiting for the purposes of the VAT cannot occur. So the fact to really segment the economy into these firms can only buy intermediate inputs and sell them to themselves, but the larger firms cannot buy intermediate inputs from the smaller firms that are below the threshold. So changing the threshold then will leave the composition, will change the composition informality, but will also have impact on firms depending on whether they want to sell to the larger firms or not as they debit or credit across the regimes. So I just always have some reactions to that. I'm going to take the fourth, because some of these questions were very much directed at individuals, which is great. Thank you very much. The person. Sorry. Thanks. Thank you. Thank you very much. So Peronos, Swiss Development Agency, CEDA. Well, thanks for good presentations. And I would like to raise the issue of the political economy of informal employment. The issue why do firms not formalize, and there's a lot has been said about why they dodge formalization, et cetera. But what about the other side? What about incentives to prevent formalization? Government incentives, government and others incentives to prevent formalization. Because clearly the informal economy is a gold mine for rent extraction. To point it out, police, et cetera, requesting bribes. So there's a lot of vested interest within departments, governments, et cetera, was on that score. But there's also the insider-outside issue, I would think, that formal firms and formal workers often have an incentive to keep others out. Because it allows segmentation of the labor market into those who can have good working conditions, worker rights, higher wages, et cetera. And they can do this because they can exploit those on the outside. So have you looked at all into the issues of governments and other vested interests trying to prevent informal firms from formalizing? Thanks. Thanks. Thank you very much. And you're Sam first, and then the person sitting behind the lady in the straps, and then we'll stop there and give them around, and then I'll see you. Okay. Yes. Yes. We're somewhere one way from Tanzania report. Yes. This is a very interesting three presentations. They have convinced me that informality is very diverse and very complex. And I think this is a good starting point because then we cannot oversimplify it in policy. But second, I think the discussion about taxation is very common even in our countries. But one way of seeing it is actually scaring away the interpreter to formalize so that we can tax them, to formalize so you can pay tax. So it would sound like formalization means paying tax. Then that's a message that go underground. But I would like to see it in terms of what a number of you have demonstrated, the productivity issue, because they are informal. They cannot access resources, information, markets, they are limited in that respect. Therefore they remain low productivity, low incomes, non-listening jobs. So one, if one sees in terms of how to access resources, then it seems as we showed in here two main categories of challenges. One is how to make it easy for them to cross into formalization through the legal and regulatory framework. But secondly, how to ensure that they have access to resources, proper premises, markets, finance, skills, all these, because they can't get access to these, they remain low productivity, low income poverty. Thank you, Sam. Very much. Yes, sir. You'll be in the next round, the person in front of the class. Hello. My name is Miko. I'm from the University of Helsinki. I have a question that, in a way, follows up the gentleman's question up front. I know you guys mentioned that informal sector is very diverse. There's a huge heterogeneity of different types of workers within the informal sector. And I'm guessing that the skills and training required to enter into and to increase the productivity in these sectors is also very diverse, but it's probably undercounted within the general education and training systems which are targeted at the more entry into the more formal economy. So how can we help prepare people to have the skills and the training required to do their jobs in the informal sector well and efficiently? How do we develop educational and training systems for that while supporting their informality at the same time? Thank you. Thank you. That's very close to Sam's question, which is great. Thank you very much indeed. Marty, may I ask you to start and then we'll go in the order of the speakers for just a couple of minutes each, I guess, at this point. Thanks for the rich and buried questions and comments. Informal livelihood and settlement, I think we need to, informal livelihood, and we need to understand the linkages there much better. Essentially, most urban informal workers work either in public space or they work in private homes. And so there's a lot of productive activities happening in the informal settlements. And we need to understand those linkages, especially under conditions of relocation. And yes, women's responsibility under most social norms for unpaid care responsibilities does two things. One is it means that more women workers than men workers work in their own homes. A full 30% of women workers in India and Pakistan work from their homes. And we have a program that Francie leads looking at the costs of the lack of childcare on the economic opportunities and productivity of women in the informal economy. On taxation, two things. One is many informal workers pay taxes. So there's a myth that they don't and they would like benefits in return. So it can't just be taxation without incentives. The other is that taxation per se is only part of the definition of informal employment. So informal enterprises are defined as unincorporated enterprises. Nothing said about taxes, although by implication, if you're incorporated, you may have to. When it comes to informal wage employment, it means that the employer is not making contributions to the social protection of the worker. And then you get into payroll and other kinds of taxes that employers are supposed to do. But if you remember the figures, only two to 9% of informal workers are employers. So much of that evasion of employer contributions is happening either by formal firms or by households that hire domestic workers. So it's a much more complicated thing than we think and it needs a lot of work. On the government and informality and on other vested interests that have an interest in Paris comment, in the urban literature, which I now follow quite closely, there is a concept of elite informality, which is when the state colludes with elite powerful interests to create exceptions to formal rules. And the classic case is the state creating informality deals with the private real estate developers by privatizing public land, right? And there is a whole school of thought that the state is really encouraging informality. In terms of other vested interests, one dimension of formalization that the informal workers would like is the right to be part of collective bargaining, tripartite negotiations, all of that. And I am reluctant to say it in Finland, but the European trade unions were blocking the right of organizations of informal workers, including trade unions of informal workers to have a direct voice in the ILO tripartite. So there are vested interests that don't want that. And I'll leave it at there, there's a lot of rich questions. Oh, the skills training, sorry, that's the last one. The notion was, and Richard Jolly was part of that early ILO mission that found that people in the informal economy often acquire their skills informally outside the formal system. And this is true when we have to recognize and certify and appreciate that. But we also know that informal workers are needing to adjust all the time, even for informal jobs. So the construction industry gets mechanized, so manual lifting and carrying is no longer very, there aren't many jobs doing that. The women who used to do the lifting and carrying would like to be trained as electricians and masons and tile layers and all the other kinds of trades within construction. And we are way behind on that. And I think we all need to get very creative about helping the informal workers keep pace even within the informal economy, and then, of course, to make the leaves. And I hate to say that in a country like India, which I know best, it's an IT-led growth. So even to get a job in a call center, you need English as a second language, right? So I mean, it's not just skills, it's the whole education system to prepare people for the formal jobs. Because if it's not manufacturing-led, it's another whole level of education and skills that are needed. Thank you, Marty. So Marty's sort of dealt with the bulk of them. I'll just say two things. I think on Per and Mika's questions about, and Sam as well, on kind of questions of access to resources and the state's incentives to keep people informed, I mean, I kind of do think that the sort of policy response from state officials to kind of all sorts of things that would have quite a big impact on basically improving incomes in the informal economy is the kind of starting point really is to get access to any resources you have to be, you've got to make yourself a formal enterprise. And I think that just loses the point that it's the wrong starting point. Just a kind of second thought on the tax issue, and it's really perhaps a question to Ravi and sort of building on Santiago's point. It seems to me what VAT does and what the VAT threshold does is to kind of regulate not whether the firm's paying VAT or not, but it kind of really regulates whether the firm has the kind of legal power fully to pass on the incidence of the tax to the final consumer or not. So if you're in the formal sector and you kind of above the threshold, the law saying you can fully pass on the incidence of the VAT to the final consumer, if you below the threshold, you paying the tax upfront and the kind of extent to which you can pass on the incidence is going to depend on what the nature of that market is. It seems to me informal people often operate in kind of highly competitive markets, so the impact might really be to rather than evade the tax, it's sort of forcing you to pay the tax and not sort of pass the incidence on. Thanks Ravi. Would you come in there? Thank you. I think the VAT point is very well taken, of course, fairly clearly. I mean, what we were trying to do was not in some sense to give a story to an analysis of the VAT, but in some sense any tax structure which has a threshold, below which certain things happen and above which certain other things happen, and below which there's a certain regime and above which there's another different regime, and what incentives does that give enterprises to sort themselves out into this side or that side, et cetera. But the point is very well taken, indeed, this is in some of your work in run, that in fact the informal sector as defined in this way does not then have the capacity to pass on, as you say, to claim those credits in the VAT, and that leads to the segmentation. So maybe I could have said everything without using the word VAT. But the basic point was that these tax regimes lead to this partitioning of the population in this way. And then your point about informal, about the labor regulation, and that's the sort of point I was trying to make towards the end, which is actually what we do in our, it's a theory paper where we'd now look at if you like two tax regimes, one with this threshold and one with that threshold. And you can think of the labor regulation as being an implicit tax regime where if you hire more than 10 workers, then you have to do registration, et cetera, and certain costs are imposed on the firm. It's just a different tax regime, if you like, quote, unquote. And then that's the question. If you have two regulatory regimes, the firm has to respond to both in some way. And how do we think about that? How do we think about that? And I think that's an interesting analytical question for economists, for technical economists to be thinking about. But there's also an interesting question for policymakers to be thinking about. If change in this regime affects incentives to locate yourself vis-a-vis this regime, and the whole point is that in the policy context, it's the labor ministry which fixes the labor regulation side of the story. And it's the ministry finance which fixes the tax side of the story in a very uncoordinated way because, of course, they haven't thought of it. They think of this as being the tax problem and this as being the informality regulation problem. And I think it's our task to bring that. So that was really the point that I was making there. On the hiding of international, again, a very, very good point. Our story would go through, it's a hide-and-seek story. It's not where the hide-and-seek can take place. But if the moment international hide-and-seek becomes available, then the costs and benefits of hiding and seeking will change. And that will then change the boundaries of the different categories. So that's a very good point. I think those are the ones that I... There were two outstanding hands from the early question, and I'll allow you the last question, Richard. And we need them to be brief. So there was you first and then you. First, this side, please. OK. Hi, my name is... And then we'll come in within time. That clocks a little fast. OK. My name is Beatriz Muriel. I am from Bolivia, from the INESAD Foundation. I'm talking because 75% of workers in my country, as I saw, was established that were informal. But I think it's logic to think that with the informality is low. It's logic to think that the formal sector can absorb the informality sector, or the formal workers. But in the case of Bolivia, I think it is very, very complex. Actually... It won't be complex and long, right? It will be complex and very, very, very brief. Sorry to do that, Gis. So I think we need to think in two other things. The benefit and cost, because many... I think that many informal workers in Bolivia prefer to be informal, because the costs sometimes are very high and the benefits are not low. And this also, I think, it is related with the quality of institution. But it is not only to have some rights, for instance, social protection, but the quality of social protection and so on. So you have to think not properly to reduce informality, but improving formal rules and improving the quality of institutions. Thank you for that comment very much. And yours? Thank you. I'm Evi Van Stolen, I'm from Finland. I am an independent researcher, so I guess I count to the informal economy. And I was very, very pleased with all your presentations, also the introduction of Viego, because I am struggling with the same questions in a post-industrial society. It's not as large, but it's just as important for the future. And I have been focusing on status of artists and work in civil society. And then I was very, very pleased to see that you have this law program where you will look at what are the obstacles posed by law. And you mentioned also the harassment that people face by legal system that does not recognize the work. And to cut a long story short, when I have been contemplating these questions, I have come to the conclusion that a basic income would be a good way of correcting the injustices in the system. And I'm curious to know if you have been thinking of these questions. And a final question or comment from Sirith? Thank you. I'd like to ask each of the panel members, in terms of what next, where would they like to see the informal sector concept go? If I'm allowed one comment, when I shave in the morning, I realize that's informal sector activity. Everything one does by way of care of oneself or health protection at home in another sense is... So I see the informal sector everywhere. How much of it these activities would gain from this sort of informal sector analysis? Thank you. Should we start with Ravi this time and move this way? And I think there were two comments as much as anything, and then question. So of course, there are national accounts type issues in Richard Shaving and so on. I mean, Pigu very famously said that if he married his housekeeper, national income would go down. And as precisely that it would then become from paid work, would become unpaid work. And the way that we measure national accounts, it would precisely be... So the whole issue of measuring unpaid for work, so to speak, is a very big and a very old issue. I'm not entirely sure that these programs that we're involved with are addressing themselves to that directly. Although of course in terms of childcare and so on, there are programs in terms of addressing those issues, so to speak. But not, I don't think, I may be wrong, in terms of technical issues of measuring that and bringing that into a measure of the informal economy. But I think that's a very good suggestion, perhaps, we should be thinking about that in terms of our programs in Uyghur. Thank you. I think that's correct that Uyghur's focus is very strictly on paid work, whether it's care work or not care work. We're trying to not dodge that line, although it comes very much, I guess, more in the social protection program than anywhere. Imran. So just all that I can do is to basically respond to Richard's challenge. For me, I think the last 20 years has brought an enormous amount of... Or some amount of clarity to what we mean by the informal economy. It's brought a lot more clarity to who's inside the informal economy and who's not, to what parts of our activities we can't as informal and which part we don't. So I think Richard's example is kind of clearly unpaid work rather than working in the informal economy. But the sort of concept still remains sort of quite clear and quite vague. So I'd like to think if we were all here at the 60th sort of conference of why that would be a lot clearer. Some of us have been the underground economy, but I don't think that's about it. Tisha, great. Marci been for your last comment. Just two or three. One is the concept of informality. I think we're a lot clearer than my colleagues are allowing. And it is a second best concept. We need something to show a spotlight on the fact that what we call formal employment is a very small share of employment today. And then, yes, we do need to disaggregate it for policy and analytic and other purposes. In terms of formalization, if you ask the workers and Imran alluded to it, they're not trying to hide. What they would like is visibility. They'd like voice. They would like legal identity. They would like protection. They're not trying. This is the working poor and they're not trying to hide. They actually want visibility and voice. And then in terms of cost benefit analysis, I think we have, it's like taxation. We have to go a lot further. We've done a lot of empirical work on the costs of informality and what the workers would like as benefits of formality and what formality would mean to them. So I think there's a rich agenda for further analysis of the costs and benefits. And then, yes, in the post-industrial societies, we're working very closely with European statistical community to get measures of informality in the European community. They're very receptive. And I think we're moving towards having sort of a global concept where we can do global definitions. So stay tuned. We're hard on work on many frontiers. And we appreciate your attendance today.