The shadow economy of mobile phones: an ethnography of grassroots entrepreneurship in an urban marketplace in China

Based on fourteen months of ethnographic fieldwork in a mobile phone market in Shenzhen, China, this thesis explores how grassroots migrant merchants operate an extensive business network for the retailing, repairing, and reselling of mobile phones. Their market activities represent a central hub in the global supply and distribution of mobile phones. Merchants rely on their own creativity, autonomous practices, and the careful negotiation of shifting regulatory regimes. To capture the agency of such grassroots entrepreneurship, which entangles formal and informal processes, the thesis develops the concept of the ‘shadow economy’. The analysis begins with the financialisation and privatisation of urban market space, showing how formalisation displaced existing social support networks and exacerbated the precarity of grassroots entrepreneurial labour. It then examines the contested notions of authenticity and trust, particularly in the local practices of supplying and providing shanzhai (copycat) and second-hand mobile phones, and demonstrates how merchants both challenge and are constrained by the dominance of Western brand owners and the state’s regulation of consumer rights. With business opportunities shrinking in a time of economic slowdown, merchants have turned to speculative activities, profiting from arbitrage on the platform-based and extensive logistics networks of mobile phones. These practices result in intensified labour for smaller returns, prompting merchants to navigate their entrepreneurial subjectivity in response to these changes.