The urban informal economy and the state in Tanzania

Most explanations for economic restructuring in Africa are concerned primarily with how such changes are the product of external pressures from the world economy and from international lending institutions like the International Monetary Fund and World Bank. This study focuses on the role of the informal economy in explaining some of the internal circumstances that allowed Tanzania to embark on a program of economic reform and austerity at a time when urban dwellers, in particular, were suffering enormous hardships. Their disengagement from the state and reliance on their own solutions helps explain why they did not always feel the full force of cutbacks in government expenditure. At the same time, people continued to resist policies that infringed on their ability to carry out informal income-generating activities through strategies of non-compliance. The Tanzanian state thus found itself attempting to mediate between conflicting internal and external pressures.;In the late 1970s and 1980s the informal economy grew in Tanzania, as in other African countries, in response to deepening economic crisis. This growth resulted in major reversals in the direction of resource flows: away from the state towards private solutions to problems of income, security and social welfare; away from reliance on wage labor to reliance on informal incomes and farming; and a gradual shifting of migration patterns with increasing movement out of the city into the rural areas. Similarly, relations of obligation in the household were being transformed with new resource dependencies on women, children and the elderly, while only a decade earlier, most urban women had relied on men for income, children on their parents and the elderly on their adult children.;This study adopts a societal-oriented approach in contrast to the prevalent state-centric emphasis of the study of African politics. Based on fieldwork carried out between 1987 and 1988, the research combined both quantitative and qualitative methods, involving informal interviews and formal surveys of workers and small-scale entrepreneurs in addition to discussions with Party and Government leaders at all levels.