The Informal Sector in Venezuela: - PowerPoint PPT Presentation

1 / 26
About This Presentation
Title:

The Informal Sector in Venezuela:

Description:

14 % of informal commerce in Caracas 'An iceberg tip' Street Vendors in Sabana Grande ... Touristy: Hotel Melia Caracas, F. A. Bello. Meetings and presentations with: ... – PowerPoint PPT presentation

Number of Views:131
Avg rating:3.0/5.0
Slides: 27
Provided by: CIPE9
Category:

less

Transcript and Presenter's Notes

Title: The Informal Sector in Venezuela:


1
The Informal Sector in Venezuela A Public Policy
Agenda
Econ. Wladimir Zanoni zanoni_at_cedice.org.ve
CENTRO DE DIVULGACIÓN DEL CONOCIMIENTO
ECONÓMICO www.cedice.org.ve Caracas. Venezuela.
2
The main question
?
What public policies should be implemented in
order to reduce the informal sector in Venezuela?
3
Why is it important to design public policies?
Formal and informal labor ( labor force
1969-2003)
Employment structure (2º semester 2003)
53
Aprox. 5.000.000
32
Source INE
Aproximately 30 of the informal workers are
street vendors
4
Why is it important to design public policies?
  • 1.- Relationship between informality and poverty
  • 2.- Informality and economic growth
  • Human capital and informality
  • The tendency to informalize formal activities

Worker
Private enterprise
Instituional counterpart Links with the set of
formal rules in the society
Labor relationship
Economic counterpart Wage and social security
5
Why is it important to design public policies
here?
  • 3.- Informality and the democratic process
  • Weakening property rights
  • Absence of the rule of law
  • Individuals loose political incentives to
    participate
  • Entrepreneurial vs. rent seeking political
    behavior

6
Our research and development project
  • Street vendors in SABANA GRANDE
  • 8 mm people 1.5 mm cars monthly (2.160 mts.)
  • Cultural and Urban importance
  • 14 of informal commerce in Caracas

An iceberg tip

7
Street Vendors in Sabana Grande
  • Why did we need researching?
  • Absence of information
  • Qualitative
  • Quantitative data
  • Information as a device to gain credibility and
    acceptance
  • Agents were reluctant
  • Information is a requirement of people


8
Street Vendors in Sabana Grande
What did we find?
Reducing informal commerce
Enforcing property rights
Lowering the cost of doing business

Human capital
Avoiding public servants corruption Enforcement
mechanisms and capacities Agencies members
incentives

Back to the initial question What public
policies should be implemented?
9
Lowering the cost of doing business
  • Access to capital
  • The lender faces the moral hazard problem
  • Lack of high quality physical assets
  • Social networks as social collaterals
  • 62 of the credit based upon
  • Informal networks


Policy advice enhance private formal
micro-lending
10
Lowering the cost of doing business
  • Labor
  • High transaction costs because of the Labor Law
  • Self employment and family labor
  • Paying percentage of sales diminishes supervision
    costs

Labor force in age ranges

Rangos de edades
Formal rules must take into account the already
existent institutions
11
Enforcing property rights
Low cost of doing business
High cost of doing business
Bribes
Bribes
?
N of votes
N of votes
1) The higher the bribes the lesser the
political support
2) The higher the bribes the higher the
political support
  • Infinite bribes amount cero
    corruption

12
Enforcing property rights in other words
  • A direct relationship between the political and
    the economic markets for renting the streets
  • The higher the political willingness to enforce
    property rights the higher the bribes will be
  • Lowering the political and economic incentives
    to rent the street as a complementary policy
  • Paying according performance
  • Information on political support as a policy
    device

13
Human capital investment
  • Complexity of achieving agreements
  • Political polarization
  • Venezuela as a battlefield
  • Lack of human capital
  • Entrepreneurs
  • Street vendors
  • Investment in human capital Lowering TC
    anti-corruption policy reducing street vending


14
CEDICEs Strategy to Promote Reforms
Meetings and presentations with
  • Public servants
  • Local Alcaldia Libertador (Executive and
    Councilmen)
  • Regional Alcaldia Metropolitana (Executive and
    Councilmen)
  • National Production and Commerce Ministry
    Officials
  • Formal Sector
  • Commerce Consecomercio, Camara de Comercio, and
    local associations
  • Real state National Chamber of Building and
    local
  • Banking Citybank, Plaza, others
  • Touristy Hotel Melia Caracas, F. A. Bello

15
CEDICEs Strategy to Promote Reforms
Meetings and presentations with
  • Street vendors
  • 8 associations, CTV
  • They demand reliable information
  • Partnership with some other organizations
    (Fundaempleo)
  • Neighbors
  • Parroquia El Recreo
  • Asociacion de vecinos Sabana Grande

16
CEDICEs Strategy to Promote Reforms
8 months weekly round table
  • Street vendors, Neighbors, Public servants,
    Formal Sector, ONGs
  • Achievements
  • Despite their political and ideological
    differences CEDICE contributed to meet all
    members and to keep them working together for 8
    months
  • Subscription of a public policy agreement
  • Lowering the costs of doing business
  • Day of parade
  • Building up social networks to enhance
    democratic participation

17
CEDICEs Strategy to Promote Reforms
Interviews, Forums, Conferences and Meetings
  • Interviews
  • National several radio, TV and press interviews
  • International NPR, Florida Sun, Veneconomia
  • Conferences and forums
  • Universities, Entrepreneurs Chambers, and
    Associations
  • Experts consultation
  • Permanent discussions with experts both national
    and internationally

18
CEDICEs Strategy to Promote Reforms
The future
  • To extend the research and development project to
    other strategic areas of Caracas (other
    municipalities)
  • To promote CEDICE as a source of reliable and
    actualized information concerning the street
    vendors problem
  • To publish the results of the project in a book
    (almost ready)

19
Políticas la oferta de derechos de propiedad
Es el postulado Mayores sobornos más apoyo
político del buhonero siempre válido en un
contexto de bajos CT?
Encuentran los buhoneros incentivos positivos
para moverse del comercio informal a otras
actividades?
Depende del path dependency!!!
20
La Pregunta Inicial
Qué políticas son apropiadas para reducir la
economía informal en Venezuela?
Políticas anti-corrupción y pro enforcement
Reducción del Comercio Informal
Reducir el costo de hacer negocios (crédito,
registro, trabajo,etc.)

Capital Humano Entrepreneurs-survivors
  • Marco de reglas formales
  • Mecanismos de forzar cumplimientos
  • Incentivos de los funcionarios públicos
  • Bribes measurement

21
La Economía Informal en Venezuela
Las preguntas y los grandes temas
  • Se supera la economía informal con expansión
    fiscal?
  • Es la solución un plan de empleo?
  • Lo es un programa de microempresas?
  • Son suficientes mejores políticas públicas?
  • Será la alternativa el crecimiento de la
    economía privada?

22
  • Gracias

23
Qué dicen las investigaciones sobre el tema?
  • De soto DDPP y costos de hacer negocios
    (Cartaya, CONAPRI, World Bank, Alayón)
  • Microempresarial y de capacitación Clustering
    advantages (Márquez, CESAP)
  • Macroeconomía ausencia de crecimiento económico
  • (Freije, Márquez)

24
Acceso al capital
Con qué capital financiero continúan?
Con qué capital financiero se iniciaron?
Base cálculos propios
25
Comercio informal en Sabana Grande
Características relevantes
La Investigación
  • ACCESO AL CAPITAL
  • ESTRUCTURAS DE COSTOS DE TRANSACCION

Base cálculos propios
26
Características relevantes
Experiencia en buhonería
Educación promedio
I
C
T
Base cálculos propios
Write a Comment
User Comments (0)
About PowerShow.com