Climate migration deepens urban inequality as myths sustain informal settlements

Cities across the Global South are grappling with escalating internal displacement driven by climate change, with new evidence suggesting that Latin America's persistent informal urban growth is not an inevitable economic stage, but the result of structural neglect and harmful societal myths. A new study published in the journal World dismantles the widely held assumptions about slum informality, revealing its detrimental impact on climate migrants and urban development.

The peer-reviewed study, “Dismantling the Myths of Urban Informality for the Inclusion of the Climate Displaced in Cities of the Global South,” interrogates how socio-political narratives and policy inertia have normalised informality, leaving millions of climate-displaced people in Latin America with limited access to rights, infrastructure, and formal employment.

What myths sustain urban informality and why do they matter?

The study identifies four dominant myths that rationalise the persistence of informality in Latin American slums. These include the belief that low regional productivity justifies informality, that informal systems offer survival concessions by the ruling elite, that informal settlements foster social capital and autonomy, and that formalisation offers little to no benefit for residents. According to the authors, these narratives are not grounded in contemporary empirical realities but serve to preserve the exclusion of marginalised populations.

The first myth positions informality as a by-product of low productivity economies. Drawing on historical theories of dual economies, this narrative assumes that the coexistence of modern, high-productivity sectors and traditional, inefficient ones is transitional and will fade as development progresses. However, the authors challenge this assumption, arguing that informality has become entrenched not because of economic evolution but due to policy failure. Rather than a symptom of growth, informality is a structural negative externality that will not self-correct without targeted state intervention.

The second myth views informality as a benign allowance granted by the elite to the poor to survive without legal burdens. The authors reveal that this is less an act of benevolence and more a mechanism to maintain social peace while avoiding structural reforms. Informality, in this framing, serves to stabilise the system by placating marginalised populations with survival opportunities that come without rights, protections, or long-term prospects.

A third common justification romanticises informal economies as evidence of grassroots innovation, adaptability, and social cohesion. The study finds this perception problematic. While informal networks may indeed foster a sense of identity and community, they also isolate residents from formal institutions and opportunities. These internal subcultures can become self-limiting, reinforcing social exclusion and blocking access to upward mobility.

Lastly, the fourth myth argues that the formal system offers limited benefits, making legalisation economically irrational for slum residents. The authors challenge this by highlighting that while formal services are underdeveloped in many cases, access to them remains key to breaking cycles of poverty. Informality results in diminished access to legal protections, healthcare, education, and representation. The absence of perceived benefits often stems not from the idea of formality itself, but from poor policy execution and exclusionary bureaucracies.

How does informality obstruct climate migrant integration?

Urban informality severely restricts the ability of climate-displaced populations to achieve stable livelihoods and exercise civic rights. With 200 million people projected to be displaced globally by 2050 due to climate impacts and Latin America already experiencing 14.5 million internal displacements in 2024 the majority of those seeking refuge in urban centres end up in precarious slums located on the city peripheries.

These informal settlements, often built progressively without legal authorisation, are marked by poor infrastructure, long commute times, underfunded education systems, and limited access to public services. Employment is generally informal, unstable, and poorly paid. In many cases, climate migrants accept the lowest quality work or turn to illicit markets out of desperation. The concentration of vulnerable groups in these areas further weakens their ability to influence public policy or demand change.

Moreover, informality is not merely an administrative status; it actively reinforces socio-economic barriers. The study reveals that informality exacerbates structural discrimination by blocking access to formal job markets, credit systems, social protections, and representation. For migrants, this effectively locks them into a state of invisibility and insecurity.

The authors also highlight how myths surrounding informality obscure its real costs. Rather than offering a foundation for grassroots resilience, informal systems often heighten the vulnerability of residents by leaving them unprotected in the face of legal, environmental, and economic shocks. Without formal rights, climate migrants cannot access social protections, legal contracts, or housing security—critical assets in post-displacement recovery.

What can policymakers do to dismantle these myths and promote inclusion?

The study sheds light on the urgent need to reframe climate migration and informal urbanisation not as crises to be managed, but as opportunities for inclusive urban transformation. Doing so requires a decisive break from the narratives that legitimise informality and exclude millions from formal citizenship.

A key recommendation is to integrate climate migration into national development and urban planning frameworks. Rather than tolerating informality as a workaround for systemic inequality, governments should actively design and implement policies that ensure access to education, healthcare, infrastructure, and legal employment. Investments in public services and inclusive governance models are essential to bridge the gap between informal settlements and formal urban life.

Furthermore, the authors call for reimagining civic participation and representation for slum residents. Existing channels are often co-opted by elites or performative in nature, leaving residents disillusioned and politically disempowered. Strengthening community voice and ensuring equitable budget allocations can empower informal neighbourhoods to transition into formally integrated urban communities.

The study also urges policymakers to abandon the idea that formalisation is a future reward to be earned through productivity gains. Instead, it should be treated as a right. Legal recognition, employment protection, and access to essential services are not incentives but necessities for building socially resilient and economically productive cities.