Is Informalization Equalizing? Evidence from Kinshasa (DRC)

Abstract

As a consequence of a concatenation of external and internal events, the economy of the Democratic Republic of the Congo (DRC) has informalized to an unprecedented level over the last few decades. A comparison of budget surveys carried out in 1975 and 2004 respectively allows us to ascertain the effect of this process on income inequality and poverty in Kinshasa. We find that the extent of inequality in the capital city of the DRC has remained largely unchanged, which strongly suggests that informalization has been a viable survival strategy for those at the lower-income end of society. Unexpectedly, whereas distinctions such as gender and age lost much of their profiling power in the period considered, other cleavages such as education and geography, which may be assumed to be much more intimately related to the formal sector, continued to play an important role in structuring inequality in Kinshasa's deeply informalized economy.