Pardo (2012) - Entrepreneurialism in Naples: Formality and Informality

Question 1

Aim of article

Answer 1

Analysis of economic activities that takes place at the margins of law.

Highlighting individual and collective frustration with culturally determined policies - and how this frustration impact relationship between citizens and governance

Question 2

Informal sector in Naples

Answer 2

Large informal sector is developing, recently involving more legal and illegal immigrants

Question 3

Citizens versus governance

Answer 3

• Neapolitans frequently treated as second-class citizens
• in light of the view that Southerners are “deeply corrupt” and has “cultural sympathy for criminality”
• Justification of lack of investment, interests of ruling elite, undermining local businesses

Failed integration of native people = failed integration of immigration must be understood

Question 4

The background

Answer 4

• Southern Italy has evolved in potentially innovative ways gone unrecognised (formality bias)
• South considered “backwards”, “untrustworthy”, overlooked
• Unemployment rates are high - yet accepted that only a small part of the unemployed do not work (highlights flawed naive/narrow distinction between employment and work)

For instance
1) Criminal powers provide illegal work - often overepeated in media in sale interests

• Local rulers have misappropriated funds through corruption.

Question 5

Economic informality

Answer 5

First conceptualised in African ethnography (Kanju-related)
Frequently applied to industrial societies
- focus on reciprocity, informal activities, support networks

Informal work is not a separate mode of production from formal work

Question 6

Sapé fa

Answer 6

1)Means “cleverness”, and defines cultural aspects of Neapolitans entrepreneurialism
2) Firmly rooted in morality and ramifications of strong continuous interractions between material (money) and non-material (moral and spiritual) domains
3) in economic terms - establishing or expanding independent small and micro-scale businesses in the context of a clear distinction between LAVORO(rewarding work) and FATICA (toil - unrewarding work), often rooted in the informal sector yet addresses market as whole.

This is not strictly legal - but NOTmarginal. Still in pursuit of success within cultural aspects that link self-interest and moral behaviour.

Question 7

Systemic regulations that inhibit formal sector to grow

Answer 7

Micro-entrepreneurs’ access to credit - and hence, citizenship - is difficult due to
1) overpriced banking
2) Property-based guarantees demanded by credit institutions
3) high interest rates on loan

Question 8

interactions between formal and informal

Answer 8

• Pietro’s firm
  started informal but got increasingly involved in formal sectors
• sapé fa helped Pietro expanding father’s business and almost phasing out all informality
• possible through money borrowed from social networks (not formal banks)
• copying original designs and selling low (sapé fa)
• foreign immigrans important employees (win-win)

Question 9

Chinese impact

Answer 9

Negative: competition rises for their low prices, nearly disappeared Neapolitan goods
Positive: can create networks with them and build upon each other (sapé fa)

Question 10

Conclusion

Answer 10

Informal sectors should not be overlooked, misread or neglecting basic rights for many by the government
Instead, governments should address actions developing outside the existing law