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and economic activity. First, in order to encouragegreater engagement between establishedformal businesses and the smaller enterprises,transaction costs and risks of such engagementhave to be reduced. Second, the public sectorhas to develop and implement participatoryprocesses so that support is relevant to those onthe fringes of formal activity. Third, change hasto be negotiated through iterative dialogue andpartnerships spanning across central and localgovernments, the private sector, domestic capitalmarkets, producer groups and their social andeconomic organisations. Fourth, the function inmicro and small scale entrepreneurial activity of‘immediate and direct reciprocities’ 5 has to berecognised; in many low-income communities,economic activities and arrangements are embeddedin social relationships. How social relationsand values, not just market forces, affect themodus operandi of millions of entrepreneurs hasto be brought into economic reform considerations.How social and cultural norms conditionthe modes of production and overall situation ofwomen entrepreneurs and indigenous peoples isparticularly pertinent to this consideration.The Reform AgendaOur working group for Chapter 4 of this reportrecommends the following as key messages in thelegal empowerment of informal businesses:1. Policy Stance• Legally empowering small informal businessesrun by poor individuals or households shouldbe seen as a central pillar of a just societyand a central strategy for reducing poverty andinequality.• Most policies and the global economy currentlyaccord privilege to large firms/enterprises oversmall firms/enterprises.• Informality is here to stay and is an essentialfeature of the global economy.• Poverty and exclusion go hand in hand. Thepoor have no choice but to accept insecurityand instability as a way of life. Our reformagenda reflects the realities of poverty andexclusion experienced by poor people, andtherefore focuses on removing the barriers thathold the poor back, and building a frameworkof laws and institutions to provide genuineprotection and opportunity for all. This will requirewholesale systemic changes to all facetsof the legal framework, including: the politicalprocess, economic policy, law making, publicadministration, and law enforcement.• While national governments and the internationalcommunity should seek to create asmany formal jobs as possible and formalise asmany informal enterprises and jobs as possible,informality is not going to disappear. The realchallenge will be to reduce the ‘decent workdeficits’ of those who work informally, especiallythe working poor.• Poor people’s enterprise does play a vital role inthe economies of many countries, and the poortherefore have a right to earn a living free fromharassment, extortion, beating, wrongful eviction,expropriation and exploitation. They mustbe offered equal opportunity to access local,national and international markets.• Commercial rights for informal entrepreneurs/operators should be seen as an essential partof a package of rights for the working poorin the informal economy. This would includeproperty rights, labour rights, the right to socialprotection, and the right to organise and to berepresented in policymaking and rule-settinginstitutions and processes.• Other than social protection (property, health,life, disability, old age) that is relevant for wage200