On modelling the informal sector

A recent plea by Robert Hackenberg to develop new conceptual models in order ‘to take full account of the new realities of the urban informal sector’ and ‘rid the field from divergent connotations’ is questioned. It seems that existing models easily lend themselves to analysis of the formal-/informal-sector interactions and that divergent conditions necessarily lead to ‘contradictions’. Thus, the existing arsenal of models cannot be held responsible for ‘analysis paralysis’. New research on the informal sector, rather than aiming at ultra-generalizations, should concentrate on issues such as identification of the determining factors of the urban production technologies and the nature of linkages and elasticity of substitution between formal and informal production.