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Explaining consumer motives to purchase in the informal economy

ABSTRACT: Usually, studies on the informal economy focus mainly upon those working in the informal economy (supply side). However, many exchanges in the informal economy are initiated by purchasers asking how much a good or service costs if paid cash in hand. Therefore, the aim of this paper is to advance understanding of who make purchases in the informal economy and the reasons of the consumers making these purchases (demand side). Two potential explanations are evaluated. Firstly, consumers are explained as rational economic actors seeking a more convenient deal or profit maximisation (i.e., lower price or better value for money), making purchases from the informal economy due to the lack of availability of the product or service they need on the formal market, or they make such purchases involuntarily, due to the lack of perfect information necessary to make a fully rational economic decision when purchasing. Secondly, the consumers are portrayed as social actors pursuing community help. Using a multilevel mixed-effects logistic regression analysis on a 2019 Eurobarometer interviews in 27 EU member states and the UK reveal how the prevalence of these motives significantly varies across populations and regions. The theoretical and policy implications of the findings are discussed in the concluding section.

SUBMITTER: Horodnic I

PROVIDER: S-EPMC8519443 | biostudies-literature |

REPOSITORIES: biostudies-literature

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Project description:Background: There are approximately two billion workers in the informal economy globally. Compared to workers in the formal economy, these workers are often marginalised with minimal or no benefits from occupational health and safety regulations, labour laws, social protection and/or health care. Thus, informal economy workers may have higher occupational health risks compared to their formal counterparts. Our objective was to systematically review and meta-analyse evidence on relative differences (or inequalities) in health services use and health outcomes among informal economy workers, compared with formal economy workers. Methods: We searched PubMed and EMBASE in March 2020 for studies published in 1999-2020. The eligible population was informal economy workers. The comparator was formal economy workers. The eligible outcomes were general and occupational health services use, fatal and non-fatal occupational injuries, HIV, tuberculosis, musculoskeletal disorders, depression, noise-induced hearing loss and respiratory infections. Two authors independently screened records, extracted data, assessed risk of bias with RoB-SPEO, and assessed quality of evidence with GRADE. Inverse variance meta-analyses were conducted with random effects. Results: Twelve studies with 1,637,297 participants from seven countries in four WHO regions (Africa, Americas, Eastern Mediterranean and Western Pacific) were included. Compared with formal economy workers, informal economy workers were found to be less likely to use any health services (odds ratio 0.89, 95% confidence interval 0.85-0.94, four studies, 195,667 participants, I2 89%, low quality of evidence) and more likely to have depression (odds ratio 5.02, 95% confidence interval 2.72-9.27, three studies, 26,260 participants, I2 87%, low quality of evidence). We are very uncertain about the other outcomes (very-low quality of evidence). Conclusion: Informal economy workers may be less likely than formal economy workers to use any health services and more likely to have depression. The evidence is uncertain for relative differences in the other eligible outcomes. Further research is warranted to strengthen the current body of evidence and needed to improve population health and reduce health inequalities among workers.

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Explaining consumer motives to purchase in the informal economy

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