The state and informal markets

The informal economy is often conceived as operating beyond the sphere of state control. The activities of informal workers are, by definition, unregulated. However, informal actors interact with state authorities on a regular basis. State officials can enforce specific norms if they choose to, and escaping or negotiating enforcement is a key part of conducting informal business. State officials can also protect informal workers by granting them tokens of official recognition such as street vending licenses. These titles are precarious and seldom offer a way out of informality. But they can have long-term distributive consequences overlooked in the literature. This is the topic of my paper “The Peddler’s Aristocracy” currently under review (with R&R).

At the same time, global policy trends in urbanism are overriding the influence of local officials. Policies aimed at boosting the urban economy often seek to attract foreign capital, high-tech firms, and high-skill workers by creating urban spaces that look clean, feel safe, and work efficiently. Informal trades like street vending face serious threats as a result. Large-scale evictions carried out by police forces and city officials have multiplied across cities in the Global South, and São Paulo was the theatre of a massive six year-long campaign to remove peddlers from the streets. Traditional forms of counteraction, such as clientelism or bribery, lose their effectiveness in this context. In “The Politics of Field Destruction and the Survival of São Paulo’s Street Vendors” – published in Social Problems – I analyze how the judicial field can be activated in support of street vendors despite their having few and precarious legal rights.

Finally, I examine the impacts of the 2014 World Cup. Mega-events like the World Cup epitomise the transition towards a postindustrial economy characterised by technology-driven, capital intensive production networks and scarce demand for manual labor. The protection of intellectual property leads to the criminalization of unofficial trade, especially at fan gatherings, and massive police forces are deployed for the occasion. On the other hand, large crowds of high-spending tourists flock to the country. In a paper titled “The Peddlers and the World Cup,” I analyze the responses by different groups of peddlers to this mixed bag of constraints and opportunities. Vendors with preexisting ties to state officials obtain valuable information about rules and enforcement ahead of the event while unlicensed vendors resort to risky independent strategies.

I am currently working on a book manuscript tentatively titled “The Wretched of the City,” in which I analyze how the restructuring of urban economies as a result of the digital revolution and globalization has reshaped the survival strategies of the urban poor.

Research Setting

Twenty million people spread over 3,000 square miles of high-rises and shantytowns form the metropolis of São Paulo, the largest in the southern hemisphere. As Brazil’s economic capital, São Paulo has attracted millions of migrants from rural areas, the Northeast, and foreign countries. In the post-war era, most newcomers sought employment in manufacturing. For those who did not find manufacturing jobs, were laid off, or craved autonomy, the bustling commercial streets of downtown São Paulo offered an alternative source of income. Today, an estimated 100,000 street vendors work in the municipality of São Paulo, which contains about half of the city’s population. This informal economy is bound to grow amid the current economic crisis. At the same time, São Paulo’s status as the wealthiest city in Brazil and a financial hub with a vast high-end service sector creates demand for neat urban landscapes among influential local elites. The resulting tension makes the streets of São Paulo – especially the downtown area – a privileged site to study the contentious dynamics of informal trade.

Related work

Review of Janice Perlman, Favela: Four Decades of Living on the Edge in Rio de Janeiro, International Journal of Urban and Regional Research, published in Volume 36 (2), Pp. 403-4. March 2012.

“Santos: The Gold Hunter” in Invisible in Austin: Life and Labor in an American City, edited by Javier Auyero, pp. 42-58. Austin, TX: University of Texas Press.

DESCRIPTION: Informal labor is not the preserve of cities in the Global South. Booming and trendy American towns attract their fair share of undeclared workers. This chapter of Invisible in Austin: Life and Labor in an American City explores the struggles of a man who migrated from Mexico some fifty years ago and helped build a city he now lacks the means to enjoy.

“The Paradox of Pacification: A Historical and Ethnographic Account of La Salada”  with Katherine Jensen and Javier Auyero. Under review.

DESCRIPTION: This coauthored paper (with Katherine Jensen and Javier Auyero) explores a scenario in which an informal market develops on private land, with less state intervention, leading to high levels of interpersonal violence among market participants. We dissect the emergence of informal organizations that monopolize coercion and tax extraction inside the marketplace, thereby contributing to its pacification over time. The state is not completely absent, however, from the making of such monopolies. The paper draws on a case study of the market of La Salada in the outskirts of Buenos Aires.