Governing the Ungovernable? Street Vending in Chicago and Mumbai

Estimates indicate that informal workers constitute over 50% of the labor force in developing countries, and over 25% in OECD countries, creating a combined $10 trillion annually around the globe. Initial research on the informal economy theorized this type of work would decline as economies modernized. Defying predictions, informal economies continue to exist in geographies across the globe, and are growing in many places. The dissertation addresses a critical question on the informal economy: why do some informal industries, like street vending, continue to thrive even when they are banned by local policy? Much of the early literature argued that informal economies thrived in the shadow of the state, and thus informal workers were able to fly under their state’s regulatory radar. However, rather than an absence of the state, this dissertation argues that informality is a state product; a product of political actions, institutions, and negotiations. Through a comparison of two distinct cities—Chicago and Mumbai—this research demonstrates that despite different state contexts and strength, similar patterns of informality within the local state allow street vending to flourish. Specifically, local officials, leaders, and even street vendors themselves are able to capitalize on their local informal institutions, including aldermanic prerogative in Chicago and bribes in Mumbai, enabling unauthorized vending activities to persist. By understanding the disjuncture between official policy and its implementation, we are able to see how the boundaries between formal and informal, and the state and society are not rigid but instead fluid and negotiable. Further, the findings highlight that informality is not the domain of civil society, but can be a tool of governance invoked by the state. The research was carried out through participant observation, interviews, maps using GIS data, and an ordinance analysis.