The societal presence and impact of the informal economy are inescapable. Around the world and especially in areas of widespread poverty, unregistered and unregulated organizational entities operate in the part of the economy that either fails to adhere to the established institutional rules or are denied their protection. Reports from the International Labor Organization find that 48% of the labor force works in the informal economy in North Africa, 72% in Sub-Saharan Africa, 51% in Latin America, and 65% in Asia. Studies from the International Monetary Fund find that the informal economy account for 10-20% of the GDP in developed countries and as much as 60% in developing countries.
The aim of this PhD scholarship is to explore the drivers and consequences of how firms in a variety of informal economy contexts structure their organizations. As has been a cornerstone in organizational theory for decades, firms must structure their organizations in ways that match the external environment to operate effectively. However, the nature of the informal economy firms may prevent them from effectively realizing the potential of their organizations. For example, the absence of formal contracts to coordinate firm and human resources calls into question the role and effectiveness of non-contractual coordination mechanisms, such as trust, reciprocity, common grounds, and social networks. Moreover, as many firms in the informal economy have no other option than to operate informally due to the costs and difficulties of registration and taxes it is uncertain how they systematize and effectively exploit different coordination mechanisms.
This PhD candidate will be expected to collect rich qualitative and quantitative data and develop rigorous theory to understand how firms in the informal economy structure their organizations. Geographically, this project will focus on industry clusters in Sub-Saharan Africa where the share of the informal economy is higher than in any other region in the world. The ideal candidate therefore has an educational background in the area of organizational theory and/or development studies and possess strong skills in both quantitative and qualitative methods.
This PhD candidate will be affiliated with the Department of Strategy and Innovation (SI) and be part of the research project “The firm in the informal economy” funded by the Carlsberg Foundation and headed by Associate Professor Marcus M. Larsen.
SI employs an international group of 45 full-time faculty members, as well as part-time faculty, postdocs, and PhD students. The core research and teaching area of the Department is strategy, innovation, entrepreneurship and international business. SI’s stated aim is to continue to be among the leading departments in strategy and innovation in Europe.
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