an application of the logit model to the analysis of informal sector activities

this paper reports on the results of a research carried out during 1993-94 aiming at studying street sellers as an informal sector activity and a source of socio-economic problems in shiraz, iran. this study makes use of two logit models in order to present a unified framework depiciting the factors that seem to affect the developmeht of informal sector activities. the first model looks at those factors affecting one’s choice of hawking as a job, and the second looks at those tactors responsible for the sustenance of hawking in shiraz. the results of the study show that: 1) unavailability of proper jobs in the formal sector, 2) lack 01 proper skills required to he employed in the formal sector, 3) inadequate income earned in the formal sector; and finally, 4) the indecisiveness of the local authorities towards the street sellers have led to the sustenance of hawking in shiraz.