and agricultural nature of underemployment suggests that the problem of income security _improves_ as workers leave largely agricultural employment for work in urban areas (even if their work remains within the informal sector).

It is important to note that urban workers in the informal sector may not have the same household strategies for insurance as their rural counterparts. Because workers in rural areas may pay little or no rent and may incur very small monetary costs, they may be better able to survive periodic downturns in income, especially if community resources are available and extended family networks provide occasional inflows, as well. In urban areas, monetary costs are likely to be much higher, community resources (especially if workers from the informal sector live in "informal" arrangements, as well) may be limited, and rural relatives may be unable to reverse the flow of financial resources when the primary urban income source dries up. As a result, while urban workers in the informal sector may earn more than their rural counterparts, they may be more vulnerable to episodic economic shocks that reduce their monetary income.

Of course, households are not forced to provide income security all by themselves. At the community level, many Neighborhood Associations _(Rukun Tetangga,_ or RT) collect an informal tax to provide welfare assistance in emergencies. Households contribute a cup of rice (or its monetary equivalent) every week, and these resources are used to help families that do not have adequate resources.<sup>15</sup> These community support mechanisms appear to be diminishing in importance; higher average income levels may be reducing the perceived need for community mechanisms, and family connections to the village may weaken as household members find employment outside the village. Nonetheless, the notion of community support in cases of severe household emergencies remains valid in much of rural Indonesia; this support mechanism, however, is less likely to be important in new urban and peri-urban communities.

A third form of private income insurance may be provided by employers, even in the informal sector. Although no written contracts may exist, the relationship between workers and their employers are governed by social customs and traditions. The resulting agreements between employers and workers often include some elements of risk sharing; employers might agree, for example to pay a fixed wage regardless of seasonal or other fluctuations in demand. 16 Such a process might explain why rural wages, charted on a monthly basis, show no signs of seasonal variation. 17 remittances in household income in Indonesia. Rural self-employed farmers in 1993 were found to earn less than two-thirds of their income on the farm. Earnings from wages (10.5%), non-farm activities (8.5%) and capital (14%) represented significant components of overall income; miscellaneous income, including gifts and remittances, represented less than 5 percent of total household income.

> 15 F. Wiebe, 1992, p. 5.

16 World Development Reort, The World Bank, 1995, p. 87.

"Statistik Upah Buruh Tani di Pedesaan 1988-1994, Biro Pusat Statistik, 1995.

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