More Less
More Less

Gary Fields - Self-employed poor people in developing economies

Gary S. Fields from Cornell University discusses the situation of self-employed poor people in developing economies.

Why are so many people in developing economies self-employed?
They are self-employed because they don’t have sufficient access to paid employment, which is sometimes called wage employment. There aren’t enough jobs for all who want them, so people try to get those jobs because typically they pay better and they offer better working conditions, and those who don’t have to do something because they have nothing to fall back on, so they create their own self-employment.

What can policymakers do to help the world’s poor escape poverty?
There are so many ways that people could escape poverty, but let’s talk about the ones that are through jobs. So one is to get a paid job that gets created at the economy grows or through a jobs program of some kind.

People can escape poverty by continuing to work in the same activities they are but earning more for the work they do. Sometimes that’s possible as they succeed in small businesses of some kind or another. Often it isn’t, so every country has its own version of this.

My favourite example is, in India you see women, nearly all women, sitting at the side of the road all with the same tomatoes, or whatever it is, all selling the same thing, and each one selling very few, and they make a living that way. So it’s a bad living but it’s better than anything else they can get because they government doesn’t provide them with any kind of welfare benefits or communities are too poor, and families, so that’s how they live.

related videos

How can we improve IZA World of Labor? Click here to take our 5-minute survey and enter a prize draw.