Herrle, P. & Fokdal, J. 2011: Beyond the Urban Informality Discourse: Negotiating Power, Legitimacy and Resources

Geographische Zeitschrift, Band 99 · 2011 · Heft 1 · Seite 3–15© Franz Steiner Verlag, Stuttgart

Beyond the Urban Informality Discourse: Negotiating Power, Legitimacy and Resources1

PETER HERRLE and JOSEFINE FOKDAL, Berlin

In recent years informality has been defined and re-defined in the context of urban development. Evolving from initially being understood as a ‘sector’ of the economy to currently being redefined as a ‘new way of life’, ‘informality’ has become a rather ambiguous term. According to our understanding, many of the current concepts of informality do not capture the complexity and importance of connectivity between sec-tors, levels, and actors. In particular, they neglect the importance of power relations and the blurriness of constantly negotiated and readjusted boundaries between the acceptable and the non-acceptable, legal and non-legal. In this article, we question the usefulness of the term ‘informality’ and instead propose a set of parameters in order to describe negotiation processes inherent to the term ‘informality’. We suggest a model that tries to avoid the ambiguity of the informality debate. It offers a tool to understand the typically com-posite pattern of actors and their interplay regarding the three dimensions: power, legitimacy, and resources.

Jenseits der Debatte über urbane Informalität – Muster der Verhandlung von Macht, Legitimation und Ressourcen

In den letzten Jahren wurde der Begriff „Informalität“ im Kontext von Stadtentwicklung umdefiniert und erweitert. Im Verlauf des Wandels von der ursprünglichen Definition als Wirtschaftssektor der städtischen Armut zum derzeitigen Verständnis als ‘neue urbane Lebensform’ hat der Begriff seine Aussagekraft ein-gebüßt. Die neueren Definitionen von Informalität sind zu vage, um die Komplexität der Beziehungen zwischen Akteuren abzubilden. Insbesondere werden Aspekte wie Machtverhältnisse und die Grauzonen der Verhandlungsspielräume zwischen akzeptablen und inakzeptablen, legalen und nicht-legalen Arrangements nicht berücksichtigt. In diesem Aufsatz wird der Nutzen des Begriffs „Informalität“ für die heutige Stadt-debatte in Frage gestellt und stattdessen – ausgehend von einem akteurszentrierten Ansatz – eine Reihe von Parametern entwickelt, welche die Unschärfe des gegenwärtigen Informalitätsdiskurses vermeidet. Das vor-geschlagene Modell bietet ein Werkzeug zur Abbildung typischer Muster der „formellen“ und „informellen“ Verteilung von Macht, Legitimation und Ressourcen zwischen Schlüsselakteuren der Stadtentwicklung an.

Since its introduction to the development discourse in the 1970s the term has undergone considerable changes and refinements, but only in the last decade has it witnessed a revival char-acterized by a new level of ‘complexity’ and a prolific increase in meanings and contexts. Not only have various types of ‘informality’ been identified, but also a wide range of fields where concepts of ‘informality’ are employed as tools to explain the functioning of economic, social

1 Introduction

This is not another attempt to define or re-define the term ‘informality’ in the context of urban development. Instead, our intention is to propose a set of parameters to describe processes that are usually associated with the rather vague term ‘informality’. Our claim is that these parameters deliver a more precise picture of what is usually labeled ‘informal’.

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4 Peter Herrle / Josefi ne Fokdal

and spatial urban development processes. In this article we intend to question the usefulness of the term ‘informality’, and to explore some of the mostly unquestioned assumptions inherent to it.

From the very beginning, concepts of infor-mality suffered from the bias caused by looking at certain phenomena from the ‘outside’ world. For the observers from the northern hemisphere of the 1970s it looked like a sheer miracle that people who were not represented in labor statis-tics were able to survive. Similarly, in the 1980s and 1990s urban planners pointed to slums and squatter settlements as solutions for those who were obviously not serviced by the housing sector of national and local policies, a fact that gave rise to the term ‘informal settlements’. From understanding informality as a ‘sector’ of the economy via the ‘continuum’ concept up to the recent re-conceptualizations as ‘subaltern urbanism’ (Roy 20102), the term has retained the ambiguity and middle-class outsider perspective that make it so difficult to accept as a neutral theoretical concept.

This observation has led us to look at the rel-evant phenomena from a more ‘systemic’ view, bearing in mind that it is not possible to isolate ‘informality’ from other important factors such as the urban social, economic and institutional systems that determine the formation of urban development.

It may not be by chance that the trigger for our re-consideration of the term ‘informal’ is not the typical city of the global South showing signs of urban dualism such as slums vs. gated communities, impoverished masses vs. afflu-ence, uncontrolled development vs. prestigious developer driven projects etc. Instead, the em-pirical ground on which the following arguments have been developed is the Pearl River Delta in south China, a region not explicitly known for loose development controls, weak enforcement of land use and building laws or ‘informal’ labor arrangements.

2 Informality as a ‘sector’

The origin of the term ‘informal’ is widely known and has frequently been reiterated throughout the body of literature (e. g. Herrle 1982, Komlosy et al. 1997, Hall/Pfeiffer 2000, Maloney 2004). It may suffice here to trace some of the more influential contributions and put them in the line of argument of this article.

The term ‘informal’ was coined in a dis-course on the economy of developing countries as early as the 1970s. It was first suggested in a study by Hart (1973) on Ghana and it came into general usage after being adopted by the International Labor Office (ILO) in a series of studies. The dichotomy ‘formal’ vs. ‘informal’ superseded earlier models such as ‘modern’ vs. ‘traditional’ (Weeks 1975), ‘capitalist’ vs. ‘peasant production systems’ (McGee 1971) or ‘firm economy’ vs. ‘bazaar economy’ (Geertz 1963). The characteristic trait that made the new term so attractive was that it recognized the transformation of pre-colonial economic structures into those that had – at least to some extent – been ‘modernized’ without becoming a part of the modern economic sector. Obviously, these informal systems provided low incomes for urban dwellers without formal contracts or social security and thereby helped migrants and poor urban dwellers to survive under harsh economic and physical conditions. The proximity of ‘in-formality’ to poverty seemed to justify a concept of informality as a ‘survival economy’ (Herrle 1982). Evers and his team (e. g. Evers/Schiel 1979, Evers 1981 on Jakarta, Evers/Korff 1986 on Bangkok, Evers 1987) went a step further by applying the concept of ‘subsistence production’ to the productive and consumptive patterns of the urban poor. They assumed that through self-help construction of housing, infrastructure and the ‘acquisition’ of land, subsistence production as a mechanism outside the market economy plays a major role in providing the urban poor with basic goods and services.

However, as we concede in retrospect, the limitation to poverty blanks out a whole range of contextual conditions and phenomena that


Beyond the Urban Informality Discourse: Negotiating Power, Legitimacy and Resources 5

equally escape statistics, formal procedures and regulations. Already in the early 1980’s, in our study on the informal economies of Davao City in the Philippines, we were able to verify Santos’ three types of linkages to the outside world of ‘informality’, i. e. capital, wholesale and trans-portation (Santos 1979). We also encountered fairly big enterprises in these (and other) fields, which could obviously no longer be labeled as ‘survival activities.’ They showed signs of an economy of ‘scale’ – albeit on a modest level – but also a complex mixture of regulated and unregulated, controlled and uncontrolled, registered and unregistered elements (Herrle/Lübbe/Rösel 1981). What we saw neither fit into a simplifying juxtaposition of the ‘formal’ with the ‘informal’ nor into the patterns of subsist-ence production. Similar observations may have brought some researchers to see informality as a ‘continuum’ (e. g. Hall/Pfeiffer 2000, 71). To our understanding this concept does not capture the composite patterns of certain economic activities, nor does it reflect the importance of connectivity between sectors, levels and actors. Moreover, it tends to harmonize the imbalances and conflicts inherent in the social and economic transaction processes involved.

3 From ‘sector’ to ’circuit’

Milton Santos (1979) was among the first to widen the view from ‘activities’ to ‘systems’ by describing the mutual dependence of formal and informal economic circuits. He established the model of “the two circuits of the urban econo-my”. A chain of middlemen links the informal circuit with the formal part of the economy. Key positions in this system are occupied by wholesalers, transport entrepreneurs and money-lenders who have access to the modern banking facilities. All three operate in both sectors of the economy. They possess modern means of storage, credit procurement and the necessary supra-local radius of action to take advantage of inter-regional price differentials. On the other hand their position is secured over the long term

by dependent clientele groups from the urban poor communities. The further down one looks on the ladder of middlemen, the smaller the radius becomes, the shorter the duration of the credit, the higher the risk and the interest rate charged (cf. Santos 1979, 123-124) and – one may add – the higher the dependence and the degree of exploitation of the individual informal enterprise.

The advantage of Santos’ approach is that it gives up the biased one-way view on informality and puts it in the framework of a two-tier system of mutual dependence from which both the ur-ban poor clientele and the middle men benefit. He realized that “the ‘dualism’ identified by so many authors is nothing more than the general manifestation of the upper circuit’s hegemony, which can be seen in more striking terms in the guise of monopoly, on the one hand, and underemployment on the other” (Santos 1979, 27). This is in line with a number of other au-thors who pointed at the structural ‘symbiosis’ (Bienefeld 1975) and the interdependency of the two circuits (Bose 1974). Building on his earlier works McGee (2002) also refers to the issue of inter-dependency.

While Santos’ analysis was correct for a small part of what is understood by ‘informality’ today, namely the poverty-related phenomenon and economic dependency, he overlooked i) that certain patterns of informality also occur in places (and circuits) other than those dominated by poverty and ii) that informality cannot be limited to the economic systems of cities only. One of those areas is certainly the ‘informal urban development’ discussed below.

4 Informal urban development

In parallel with the declining interest in the ‘informal sector’ debate in the 1990s, the term ‘informal’ was adopted by planners, architects and housing experts. Since then, it has been used to denote ‘unplanned’, ‘irregular’ or il-legal settlements that are often (but not always) inhabited by low-income communities and/or



rural migrants. The term ‘informal settlement’ superseded a large number of euphemistic terms such as ‘spontaneous settlements’ (Oestereich 1980) or ‘unplanned settlements’ which gave the misleading impression that these settlements develop ‘spontaneously’ without planning or strategic thinking. In many cases ‘informal set-tlements’ illegally occupy private or public land and do not comply with existing subdivision and building regulations. However, since Turner’s early studies on Lima (Turner 1967, 1968, 1972) we know that most of these settlements are far from being unplanned, un-organized or irregu-lar. In Lima, up to the late 1990s new barriadas were not only planned by professional planners but also coordinated with the city government.

Although the early examples of Lima and other places show that there is a ‘gray zone’ of government toleration in ‘informal’ urban development, the legality of tenure remained an issue both for political practice and academic research: For politicians, illegality provided the pretext for massive evictions. Academics such as Payne (1999, 2002) and Durand-Lasserve/Royston (2002) embarked on intense research on tenure issues proving that tenure security can be reached outside cumbersome and never-ending legalization procedures. The importance of legal-izing land tenure for the urban poor was further emphasized by writers such as Hernando de Soto (2000) who, through a neo-liberal approach, cultivated a positive view on the ‘capacities’ of the poor. According to this line of argument the stigma of poverty and exclusion could easily be overcome, if the potentials of the marginalized were unleashed from restrictive government poli-cies and rigid regulations and their interactions were integrated into formal systems. Recogni-tion, legalization and ‘regularization’ were the standard strategies derived for urban policy.

From many countries, other forms of mid-dle class informality are reported: In India for example, many middle class families live in ‘il-legal subdivisions’ in peri-urban neighborhoods of large cities. Land is provided by developers who illegally subdivide agricultural land for residential purposes. Large tracts of land hous-

ing millions of people have been urbanized in Asia, Africa, Latin America, and the Middle East following this pattern (See Payne 1997, 7ff., ES-CAP 1997, chapter III for general characteristics, Risbud 1989 on Delhi, India, Wehrmann 2005, 45-46 and 157ff. on Accra, Ghana, Santos 2003, 241ff. on Vilar Carioca, Brazil). What makes this transformation process special is the fact that it is widely tolerated by city officials or takes place beyond the control of city authorities, outside their administrative boundaries.

While definitions of informality based on the legality of land tenure and/or compliance with land use and building regulations may be easy criteria for distinguishing ‘informal’ settlements from formal ones, again, they do not consider the typical mixture of the ‘informal’ and the formal, nor do they reflect the ambiguous relationship between settlers, intermediaries and city govern-ments that seems to be endemic in contemporary urban development in the global South. Moreo-ver, they also tend to overlook the importance of power relations and power plays between various urban actors that increasingly define and constantly re-define the blurred boundaries between the acceptable and the non-acceptable, the legal and the ‘not-so-legal’3.

5 Informality as a ‘way of life’

Meanwhile, although not always explicitly ex-pressed, notions of ‘informality’ have become part of a much wider and more theoretical de-bate, encompassing the sensitive and sometimes precarious relationship between state organiza-tions, civil society, and issues of planning and legitimacy (van Dijk/Noordhoek/Wegelin 2002, Mitlin/Satterthwaite 2004). This has added a new dimension to discussions about urban planning issues and local governance (Goethert/Hamdi 1997, Stratmann 1999) and instigated a new wave of research into ‘informality’ culminat-ing in declaring informality a ‘new way of life’ (AlSayyad 2004). This statement is reminiscent of Louis Wirth’s famous article “Urbanism as a Way of Life”, which drew our attention to “ur-



banism” as a “complex of traits making up the characteristic mode of life in cities […]” (1938, 7). Whether deliberately or not, AlSayyad’s statement also recalls Jocano’s well-known book on ‘Slums as a Way of Life’ portraying the lives of slum dwellers in the Philippines (Jocano 1975). All three authors generalize what had previously been considered a marginal phenomenon. By declaring urbanism, slums, and informality a “way of life,” they include a seemingly marginal phenomenon, which had earlier been discussed along the narrow paths of physical or economic models, into a broader social-science context.

According to AlSayyad/Roy urban informal-ity is “an urban logic”. “It is a process of struc-turation that constitutes the rules of the game determining the nature of transaction between individuals and institutions and between insti-tutions” (2004, 5). Taking up Wirth’s language, it has also been epitomized as a “new mode of urban existence” (2004, 5). AlSayyad and Roy go on to argue that urban informality as “a co-herent mode of life in an era of liberalization” is not really new, but has existed since the Mid-dle Ages and has persisted in many parts of the developing world.

The review presented above raises a number of questions:

– Does ‘informality’ relate to phenomena only in an ‘era of liberalization’? Or does it exist as an almost ubiquitous aspect of any urban life independent of its political or economic of even historical formation?

– Is there really something persisting? Or has ‘informality’ always – as AlSayyad/Roy (2004) rightly concede – been there as an integral part of urban formations?

– If ‘informality‘ is no longer associated with urban poverty nor with illegality, nor with the control of processes, as in the early days of the debate, what is it then?

– How can we operationalize the term ‘infor-mality’ as a “mode of life” or a “mode of urbanization” (Roy 2005, 147) in an era of globalization of production, growing impor-tance of networks, changing landscapes of

actors, and a growing disembeddedness of local systems?

Following Roy (2005), Altrock (2010) suggests a ‘conceded informality’4 approach, which points at the way by which privileges are granted or negotiated in direct and indirect ways, politi-cized and prone to conflicts. This comes quite close to what we have earlier discussed as key determining factors in hybrid local governance systems (Herrle et al. 2005).

In terms of placing the discussion of ‘infor-mality’ into the larger context of governance, Etzold et al. define ‘informality’ as a “continuum of interrelated social processes and practices with different degrees and qualities of (in)formality” (2009, 4). They suggest a concept of “informality as agency”, which, based on Misztal (2000), highlights the importance of social interaction. Etzold et al. introduce the term ‘arena’ to denote the economic, social, temporal and physical ‘space’ that is under consideration. Their article also concedes that “the question what is ‘informal’ and what is formal, […] can only be answered in perspective of the actors involved” (2009, 9). Why then re-affirm the term ‘informality’ with a concept that obviously transcends its origins by offering a much wider and more coherent analytical framework?

Thus, the more we open the term ‘informality’ to an ever wider range of aspects of urban life, the more difficult it seems to keep it operational – not only in empirical but also in theoretical terms. If almost everything becomes ‘informal’ – which obviously seems necessary – the widen-ing itself may eventually erode and destroy the usefulness of the term.

6 Informality – a myth?

A myth typically tries to provide an explanation for things that are intransparent for one reason or the other. Frequently myths help sustain tradi-tions. In retrospect, i. e. once myths have been revealed as such, they seem to have prevented a more rational view on certain phenomena, fresh thinking and new concepts. By definition, myths



have to have a ‘soft’ core and be conservative. Without a certain degree of vagueness they would lose their attractiveness. Why then is the concept of ‘informality’ a myth?

To our understanding the term ‘informality’ helps sustain myths about urban phenomena for a number of reasons:

– The proliferation of new ‘informalities’ of-fered in recent writings provides ample evi-dence of the structural ambiguity of the term and its ever-changing formations. Current concepts of ‘informality’ cross the border of the conventional stringent definitions at the cost of giving up the claim for an exactness and clarity. Some of them obviously play with the vagueness of connotations and meanings in different fields of knowledge.

– The concept still retains the problematic legacy of its founders: If not clearly defined (and narrowed down to operational terms), ‘informality’ remains something inside the ‘black box’. We do not know exactly what is happening inside, but we assume that there must be something that does not follow the logic of the outside. In trying to describe the inside we find ourselves among unique cir-cumstances that cannot easily be generalized.

– There is a tricky mechanism in using the concept ‘formal-informal’: It almost inevita-bly re-establishes a dichotomy that so many observers claim to have overcome.

Our conclusion has not been to discard the at-tempts to further define and develop coherent concepts of ‘informality’ for specific sub-groups of an urban society, but rather to move towards a more complex explanatory model that tries to avoid the latent ambiguity of the informality debate. For a number of reasons the model we suggest cannot be developed from ‘inside’ the informality discourse. These reasons include:

As emphasized in the recent informality discourse, phenomena of ‘informality’ occur beyond poverty and exclusion, economy and settlement, private and public, state and civil society. Following the recent debate, the term describes a ‘mode’ shaping physical as well as social and political environments in cities.

There is an increasing recognition of the importance of connectivity of various urban subsystems (at various levels) including interac-tion between systems as factors determining the patterns of how resources are distributed and how access to services in cities is granted; this calls for a shift of interest toward governance processes.

As many authors have stated – informality is nothing new. As an un- or less regulated part of state organization, it has been part of the every-day urban life in societies (not only in urban ar-eas) throughout history. Regulative mechanisms were often kept to a minimum in ancient Asian as well as medieval European cities5. Societies were organized around ‘informal’ arrangements. Despite all efforts to formalize urban life and development, the formal systems seem to rep-resent just the tip of the iceberg on a broad base of all kinds of unregulated, partly regulated or de-regulated subsystems of the urban society.6

7 Beyond informality

If we leave the inherent deterministic conno-tation of the formal-informal dichotomy (or the ‘continuum’ as its modification) behind, we realize that in cities there are a number of mechanisms or subsystems that, in a more or less permanent way, organize and secure the (unequal) distribution of resources, the (unequal) access to services and the (unequal) distribution of power. Depending on the political system, economic conditions, social and cultural tradi-tions, effectiveness of the administration etc. there may be countless variations in how the result is achieved, but in most cases there is a constant process of negotiation.

What we see here appears as a reiteration of the 1980s debate, when the term ‘informality’ was branded as an explanation of why so many people still exist in cities with staggering econo-mies and live under devastating living condi-tions. Currently we are encountering a similar ‘miracle’ at the collective level. Why are cities still functioning (and continuing to be attractive) although their government systems are weak,



plans are not implemented, their population shows an increasing social divide, and a coherent management structure is not in place? The gen-eral experience is that in many countries, large cities would long have collapsed, had there not been certain clandestine factors keeping them together and granting economic progress and a minimum of coherence (cf. Mertins 2009, 59).

The reason seems to be that cities are being produced by not just one group nor are they planned and implemented by planners or politi-cians alone; they are rather the common product of a wide range of actors, some of which are known and understood, others are less known, but play an equally important role. The result is by no means a neutral one, it is rather based on the power play and ‘negotiation’ between ‘collective actors’ as it has been suggested by scholars such as Scharpf (1997) and earlier by Mayntz (1963). Herrle et al. (2006) argue that negotiation and consensus-building form vital parts of contemporary local governance systems particularly in the global South. This view is also reflected in propositions of the new insti-tutionalism which ascribes conflicting interests to actors that are interdependent. A theoretical concept supporting our approach is also the inter-institutional model of clientelistic relationships developed by Pierre (1999) and DiGaetano/Strom (2003) and consolidated by Ley (2010).

Negotiation as we understand this term does not necessarily involve face-to-face contact: There may be numerous forms of indirect in-fluence on decision-making processes in which media coverage, financial pressure, mobilization of masses may sometimes be the better than those made by representatives at the negotiating table (see also Benz 2007). In the governance discourse of negotiations, it is most often as-sumed that the aim of negotiations is to achieve an optimized situation for the general public (Benz 2007) however this is not always the case. As found in our research in the PRD, ne-gotiations between several stakeholders are often neither a matter of acting nor of solely reacting, but rather something in between. Furthermore, the individual interest is often the motivator and

the common profit is just a side product of the maximized individual gain, as also described by Börzel (2007). The concept proposed in chapter 8 draws on these approaches.

8 The regime-matrix: power, legitimacy, resources

The regional focus of studies on ‘informality’ has mainly been on Latin America, South Asia and the Middle East (AlSayyad/Roy 2004, Etzold et al. 2009, de Soto 2000) and on countries with a significant degree of social exclusion and urban poverty. In our study on the Pearl River Delta (PRD) in South China, we observed phenomena that may well be attributed to what is usually labeled as ‘informal’: tolerated and systematic violation of building regulations, blurred re-sponsibilities, illegal land and labor markets, intransparent and fragmented decision-making procedures, uncontrolled transfer of land use rights etc. However, in this environment neither urban poverty nor subsistence production plays a significant role. If at all, ‘informality’ can be de-tected as a mode of urbanity inherent to growth patterns and processes. Under the special cir-cumstances of Chinese economic liberalization since the mid 1980s and the special conditions of the Pearl River Delta it seems that a certain level of de-regulation was conducive to local initiative and economic growth. Especially the ‘urban villages’ (chéng zhong cūn) as parts of cities or located in peri-urban areas enjoy certain privileges and benefit from loose control (see Herrle et al. 2008).

Our case of the urban villages in the PRD provides a good example for ‘negotiated’ assets. Urban villagers, as a collective, and based on their collective legitimacy (and as long as they are ‘defined’ as rural) hold large resources of land as an economic asset as well as a source of power (Wu 2009, Liu et al. 2010, see also Fokdal/Herrle 2010 for a summary account on land legislation and negotiation processes). Investors and developers from Hong Kong seek access to these resources, as do the local



authorities. However, the process of leasing land directly to investors and establishing industries (circumventing the local government) is illegal. Moreover, on an individual level, the villagers are seeking to optimize their profit by building housing for legal and illegal migrants working in the surrounding industries. The emerging structures supersede the building regulations in terms of height, densities, land use etc. The vil-lagers thereby provide a service (housing) that is solving the housing problem of huge numbers of migrants who are not taken care of by the lo-cal government. Since economic development is generally welcome, local governments tend to tolerate the situation, even though it implies violations of existing regulations and constitutes ‘informal’ processes. In fact, they are actively involved in those negotiation processes. They benefit from the informal housing provision since it lowers the risks of social unrest from the side of migrant workers and at the same time saves resources for investment in basic in-frastructure (transportation, energy etc.) needed for the booming economy. The emerging system can be interpreted as a fragile and permanently re-negotiated balance of interests involving vil-lage collectives, investors/developers and local governments as the key actors. It is a process that is self-‘regulated’ in the sense that it is driven by its inherent dynamics and ever changing rules, and constantly oscillating between what is often labeled as formal or ‘informal’.

Obviously, the classical concepts of ‘infor-mality’ cannot capture a situation as described above. This is one of the reasons why we resorted to regime theory approaches as suggested by Stone (1989, 1993). Although the growth ma-chine and the importance of the business sector in the USA have influenced the regime theory approach suggested by Stone, it seems to provide a valuable entry point for explaining the general modalities of actors, their mutual relationships and interactions. According to Stone, the regime where interests and actors meet constitutes for-mal and informal negotiation processes (1993).

Starting from Stone’s approach we felt it nec-essary to further structure the regimes in which

these processes occur. Drawing on an earlier at-tempt (Herrle et al. 2006) and backed up by our research in the Pearl River Delta we suggest a set of three parameters that may help to describe the process of negotiation more precisely than ‘informality’ approaches can: access to 1) power, 2) legitimacy, and 3) resources. They form the key parameters of local governance systems (Herrle et al. 2006) and local regimes. Typi-cally, governance systems in large urban areas show a composite pattern of antagonistic actors collectively providing inputs related to these parameters in a more or less complementary way that keeps the system as a whole together.

There may be more factors currently in use to describe the division of actors and their roles (see Risse et al. 2007). We assume, however, that the three parameters shown in this matrix are sufficient to adequately depict specific constella-tions of actors. For our purpose we have arranged these three parameters in a matrix by combining them with a set of actors. It is meant to capture ‘formal’ as well as ‘informal’ interactions and the key actors deriving from an actor analysis. It may be worth noting that what is presented below is not a normative model, but a matrix displaying roles and relationships of various ac-tors in a certain field. There is neither an attempt to derive a ‘best practice’ nor to conclude that certain combinations of distributions of assets are better compared to others. What has been categorized as ‘formal’ or ‘informal’ appears as a property or capacity ascribed to a certain group of actors. As a standard matrix to demonstrate the concept we have correlated the parameters with three groups of generalized actors7 taken from our study on the Pearl River Delta. They present a simplified set of actors that may well be modified and specified from case to case.

Inasmuch as a setup of actors and their inter-play of roles and activities is able to grant basic standards of security, social wellbeing, equity and general economic prosperity, they are usu-ally accepted as a way to organize resources, power and legitimacy in an efficient albeit com-plex and sometimes confusing way. Moreover, a ‘composite’ set of actors making differing



contributions to general welfare and basic values seems to form the rule rather than the exception in the governance of many countries including Europe8 and North America. It is typical that the equilibrium between actors and the level of their command over power, legitimacy and resources cannot be kept static for a long time. It is constantly being re-negotiated and part of the development process itself.

The power parameter tells us something about the distribution of power between various actor groups. Without a minimum of power there is no implementation of projects and on the other hand no resistance against power from other groups.

Although in a democratic state power is assumed to be vested with the government, there is plenty of room for investors, pressure groups and the civil society to exercise power and thereby push their own interests to the forefront. Power is also needed to enforce regulations and maintain law and order.

The legitimacy parameter is an important asset when it comes to implementation. In most countries law-based legitimacy is not sufficient, and even powerful actors would risk the break-out of open conflicts if they have no legitimacy base within the civil society or other powerful groups. Typically, in many cities of the global

State (City government)

Investors, Developers Urban villagesas collectives

Power Power to plan and imple-ment infrastructure, to acquire land classified as ‘rural’, to demolish illegal housing.

Power through capital to negotiate with the city gov-ernment and with the urban villages.

Power to implement projects and manage firms (global network), occa-sionally strong negotiation power vis-à-vis city govt. through media support.

Legitimacy Strong legal position by law. Decisions not always accepted by local people and villagers, pressure on participation, pressure on modernization processes.

Limited (guarantor for progress and modernity).

Strong legitimacy base in village collectives/village committees avoiding social unrest by housing migrants - allow for illegal building and land use.

Resources Rich but not unlimited, dependent on overall eco-nomic situation and rev-enues from land leasing of land classified as ‘urban’.

Capital, knowledge. Limited financial resources (based on revenues from collectively run businesses and rented factory build-ings).Land (rural or EDL* - as the most important asset is dwindling).

High level of influence on the negotiation process

Moderate level of influence on the negotiation process

Low level of influence on the negotiation process

No or limited influence on the negotiation process

* The farmlands of former rural collectives are acquired by the city government and turned into state-owned land (urban land). In return, the Guangdong provincial government requires 8-12% of the former farmland to be returned to the urban village as economic development land (EDL) (Wu 2009, Liu et al. 2010)

Fig. 1: The regime matrix: power, legitimacy, resources, a simplifi ed example from the Pearl River Delta



South legitimacy bases are fragmented not only along party lines but also within social, ethnic and economic groupings. This may lead to al-ternative arrangements and alliances.

The resources parameter indicates the avail-ability of human, technical and financial re-sources (incl. information) needed to provide services and implement projects. In many cases local governments are poor both in terms of technical capacity and human resources and have to rely on financial support from investors. This in turn might undermine their legitimacy basis with the civil society or certain groups therein.

Obviously in cases where ‘informality’ be-comes immoral, criminal and detrimental to gen-erally accepted values of human development, or in the situation of ‘failing states’ the matrix shows a shift of all three assets, i. e. power, legitimacy and resources towards fragmented (maybe rivaling) non-state actors.

We are aware that the parameters presented here are not new. They have been brought up in various discourses. However, in the context of our discussion they have the potential to reveal t he dynamic relationships between actors and translate into more precise terms what has been disguised as ‘informality’. Now, where is ‘infor-mality’, after all? As has been said at the outset of this paper: Our claim is not to add another definition for ‘informality’ but rather to develop a tool that contributes to a better understanding of the processes underlying phenomena super-ficially labeled as ‘informal’.

9 Conclusion

In rapidly changing societies, the half-value period of theoretical constructs describing certain aspects of urban formations is becom-ing shorter. This also applies to the concept of urban ‘informality’ as it has developed since the 1970s. Many of the ‘informality’ concepts are transcending the original dichotomy and the notion of urban poverty that has been associ-ated with it in the early writings. As the term ‘informality’ has developed from solely defin-

ing an economic phenomenon to include spatial structures and processes, towards ‘a new way of life’, it has become a blurred term – a myth. What has often been defined as ‘informality’ seems to be an almost ubiquitous aspect of any urban life independent from its political or economic or even historical formation.

Therefore, we suggest moving away from the term ‘informal’ with its inherent duality and poverty connotations, towards defining negotia-tion processes by discussing related phenom-ena through a set of three parameters, namely: power, legitimacy, and resources and put these in the framework of an actor analysis. It may still be too early to say whether these three dimen-sions will suffice to capture urban development trends elsewhere, but at least for the case of the Pearl River Delta we claim their usefulness for understanding the urban dynamics. What we find in the PRD provides an example for vari-ous stages of development and different forms of territorial organization of resources. It keeps systems incoherent, fluid and versatile, provid-ing the systemic potentials to quickly adapt local economies and social systems as well as physi-cal structures to global forces of development. The strength of those flexible systems derives from their ability to adapt and change and – at the same time – conserve or develop the stabil-ity and the level of coherence needed to create a reliable framework for social and economic interaction and investment. The emerging pat-terns are characterized by permanent negotiation among stakeholders and constantly shifting power relations.

In such an environment the search for ‘infor-mality’ becomes a futile and obsolete exercise, the term itself loses its relevance as an explana-tory model. In as much as basic characteristics of urban development in the Pearl River Delta are also valid for contemporary urban develop-ments elsewhere we believe that it may be worth applying the tool to other countries as well and thereby developing it further.



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Authors: Prof. Dr. Peter Herrle, Habitat Unit A53, Faculty VI, Planning – Building – Environment Berlin, Institute of Technology, Straße des 17. Juni 152, 10623 Berlin, E-Mail: [email protected] Fokdal, Habitat Unit A53, Faculty VI, Planning – Building – Environment Berlin, Institute of Technology, Straße des 17. Juni 152, 10623 Berlin, E-Mail: [email protected]

1 This article presents thoughts that have been developed in a research project on Urban Villages in the Pearl River Delta within the framework of a DFG Priority Program on „Megacities – Megachallenge. The Informal Dynamics of Global Change“. We wish to acknowledge the support provided by the DFG.

2 Ananya Roy on a colloquium of Priority Program „Megacities – Megachallenge. The Informal Dynamics of Global Change“ in Berlin on May 10-11, 2010.

3 In many countries where an offi cial land title is beyond the reach of poor settlers, paying water or electricity bills is a common way to create some sort of tenure security. Subletting of structures in settlements on illegally occupied land is another form of the blend of legal with illegal. “Invasions” that are publicly announced and even invited by the mayor as was practiced in Lima in the 1990s (Klaus Teschner, personal communication 1999) are a way of guiding development through ‘informal’ planning.

4 Uwe Altrock on a colloquium of the DFG funded Priority Program “Megacities – Megachallenge. The Informal Dynamics of Global Change“ in Berlin on May 10-11, 2010.

5 Interestingly Max Weber’s writings on the city (1921) appeared under the title „Die nichtlegitime Herrschaft“ [The Illegitimate Mode of Rule]. Weber saw the medieval bourgeois „Zweckverband“ as emerging outside the traditional legitimate patrimonial system – i. e. in terms of the formal-informal dichotomy as something ‘informal’.

6 Goethert (2005, 19) asks himself: “The customary perspective has been from the formal sector. But in the context of our helplessness and the dominant role of the informal [sic!], who then is excluding whom? Perhaps it is us, the minority formal sector of development planners that are the excluded and irrelevant?”

7 For the purpose of simplifi cation we have defi ned the actors according to the Chinese system, however, we are aware of the dynamics and moving actors, shifting roles etc. (see Ley 2010).

8 Rostalski in his dissertation (2010) provided a detailed analysis about the inter-relationship between formal urban planning and informal occupation in the process of re-developing an abandoned 19th century industrial area in Berlin, the RAW-area.


Herrle, P. & Fokdal, J. 2011: Beyond the Urban Informality Discourse: Negotiating Power, Legitimacy and Resources

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