What is Informality?
The majority of the world’s population either lives inside informal systems, or has to at some point interact with informality in daily life. For the global poor, informal systems exist as productive social and economic mechanisms that lack explicit organizational principles. In this way, informal systems are unplanned. For so many others, informal systems that have many similar properties contribute to the values that are held dear in 21st century economies: innovation, self-organization and adaptability.

In the world of development, the informal is often defined in opposition to the formal. Some say that the informal is inferior to the formal. A more accurate view is that there are inherent benefits to the formal and the informal, and they both work best when they incorporate the other.

In purely practical terms, the formal needs trust in governance, whereas the informal needs trust amongst people. Consider the case of the furious speed of global urbanization, where people are moving en masse into informal urban systems. Urbanization is coming to resemble informalization. So if cities are meant to provide the stable environment for personal and social mobility, they need to have a clear vision of the interplay between people who live in informality, and governance that functions with formality.

Informal systems also tend to have a high incidence of self-organization, improvisation and vitality. As such they appear across all manner of social systems from developing societies to innovation clusters. Considering how pervasive its presence and significant its role, it’s a surprise informality isn’t discussed and considered more often.