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Mapping potential in the informal sector: profiling innovation capabilities for ‘smarter’ policy

Year: 2026

Type: article

Abstract: While many businesses in the informal sector are survivalist and micro enterprises, there is some heterogeneity in business size, innovation and capabilities. The diversity necessitates a shift from generalized support to differentiated policy and targeted interventions. In this policy brief, we apply a new indicator framework to distinguish different profiles of innovation capabilities in the informal sector. Four distinct business profiles – skilled emulators, incremental improvers, proactive survivalists and intrinsic innovators – are identified, each of which exhibits a unique combination of competences and strategies to innovate. The classification supports the design of targeted support to unlock growth potential.

Source: Human Science Research Council SA

DOI: 10.14749/31345882

Author: Human Sciences Research Council

Language: English

Topic: Firm Innovation and Growth

Subfield: Economics and Econometrics

Field: Economics, Econometrics and Finance

Domain: Social Sciences

SDGs: Industry, innovation and infrastructure, Decent work and economic growth

Open Access status: green

Funder: Human Sciences Research Council

OpenAlex ID: W7129070393

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