Academic journal article The Journal of Social, Political, and Economic Studies

The Economics of Coping: The Plight of Women in Iraq's Informal Economy

Academic journal article The Journal of Social, Political, and Economic Studies

The Economics of Coping: The Plight of Women in Iraq's Informal Economy

Article excerpt

The author analyzes the role of women in the Iraqi economy, especially the informal sector, in recent times and considers the effect that changes to their role in the economy have had and will have. The paper argues that Iraqi women working in the informal sector face a difficult future the nature of which will depend largely on their educational background, Ba'athist ties during the former regime, the strength of various religious groups opposed to women pursuing activities outside the household, and the areas in which women attempt to pursue a career.

Key Words: The Iraqi economy; women in the economy; the legal status of women; the invisible economy; the informal economy; the shadow economy; the coping economy; the Ba'ath Party; the Shiites.


The invisible economy, the informal economy, the shadow economy the spontaneous economy: these are relatively new terms coined to describe a phenomenon that does not appear in the conventional statistical analysis of economics. This phenomenon is individual labor effort that is unnoticed, uncounted and unacknowledged. Since such "informal" work is performed daily by thousands of Iraqi laborers but is not included in the country's national income statistics, our image of how that country's economy is performing is likely to be significantly underestimated.

The informal economy in Iraq has notable diversity and heterogeneity in terms of services and commodities offered, scale of activity, official recognition, relative labor-capital inputs and location. More importantly, Iraq's informal economy is testament to the entrepreneurial abilities of the country's poorest citizens. It is a mixed blessing though. While it absorbs thousands who have no way of participating in the formal economy, it is by nature precarious. Critics point to urban congestion from unregulated downtown street stalls and to health hazards from food prepared in unsanitary conditions. The line between the informal economy and urban crime is often blurred - street vendors often sell stolen goods, unlicensed taxi drivers sometimes sell drugs or even rob their passengers.

One of the challenges facing a new Iraqi government will be that of finding ways to encourage the entrepreneurial spirit in the informal economy but at the same time to formalize it enough that some of its more negative elements are reduced. In designing strategies for building on Iraq's informal economy, policymakers will have to take into account several of its present characteristics:

* A large proportion of those involved in the informal economy are women and children, reflecting their impoverishment and frequent exclusion from the formal economy.

* By nature the informal economy is mostly unregulated and untaxed. This accounts for its dynamism, but also limits its ability to contribute to the formal economy and

* Most significantly - it is growing.

The sections below examine Iraq's informal economy from the perspective of its main constituency, women. What are the main areas of non-farm activity carried out by women? How are these activities changing as the country experiences prolonged instability and uncertainty? What are the prospects for improving the condition of women in the country's labor force and progression from the informal economy to that of formal economic activity?

Iraq's Three Informal Economies

Before assessing the situation of women in today's Iraqi economy, it is important to first examine the context in which they find themselves. In many areas of Iraq, the insurgency is dramatically affecting the informal economy through its impact on their daily lives2. Not only are women becoming the victims of direct injury and death, but noncombatants lose every aspect of normalcy. The path to school or the marketplace becomes a dangerous journey. With food, electricity and medical attention in short supply, misery multiplies and the amount of time taken up by simply trying to survive takes a high toll on any efforts to elevate one's earnings or earning potential. …

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