A strikingly large percentage of workers and firms operate outside the line of sight of governments in emerging market and developing economies (EMDEs)—a challenge that is likely to hold back the recovery in these economies unless governments adopt a comprehensive set of policies to address the drawbacks of the informal sector, a new World Bank Group study has found.
The study, The Long Shadow of Informality: Challenges and Policies, is the first comprehensive Bank analysis examining the extent of informality and its implications for an economic recovery that supports green, resilient and inclusive development in the long-term. It finds that the informal sector accounts for more than 70 percent of total employment—and nearly one-third of GDP—in EMDEs. That scale diminishes these countries’ ability to mobilize the fiscal resources needed to bolster the economy in a crisis, to conduct effective macroeconomic policies, and to build human capital for long-term development.
At this seminar, the editors of the report, Franziska Ohnsorge, Manager, Prospects Group, and Shu Yu, Senior Economist, Prospects Group, presented the report’s main findings.
Date/Time:
8am-9am Friday, June 4, 2021 (Japan Standard Time)
Speakers
Manager, Prospects Group, World Bank
Franziska Lieselotte Ohnsorge is Manager of the Prospects Group in the Equitable Growth, Finance and Institutions (EFI) Practice Group at the World Bank. Prior to joining the World Bank, Franziska Lieselotte Ohnsorge worked in the Office of the Chief Economist of the European Bank for Reconstruction and Development on regional surveillance, forecasting, and financial sector policy issues. She was previously at the International Monetary Fund, covering a range of Asian, European and Central Asian economies. She has published on a variety of topics.
Senior Economist, Prospects Group, World Bank
Shu Yu is an Economist with the Prospects Group of the World Bank. Her main research interests are in areas of international economics, development economics, and political economy. Prior to joining the World Bank, Shu held a post-doctoral fellowship at the University of Rochester and worked at the IMF and the Conference Board. She holds a PhD in economics from the University of Groningen and a BSc in economics from Fudan University. Her recent papers include work on China’s outward direct investment, stability and long-term growth, and the impact of institutional quality on trade.
Presentation material:
The Long Shadow of Informality: Challenges and Policies (PDF)