Conversion capacity under constraint: navigating formal and informal fields in urban poverty

This article explores how structurally poor residents in Dutch cities navigate formal and informal economies, using Pierre Bourdieu’s capital theory to understand persistent poverty. Based on 216 qualitative interviews conducted in high-poverty neighbourhoods of Amsterdam and Rotterdam, we introduce conversion capacity, the field-specific ability to transform one form of capital into another , to examine the barriers and opportunities faced by individuals. First, we show how formal institutions often fail to recognise and value respondents’ existing skills and social capital, enforcing rigid welfare conditions that many cannot meet. Second, we document how informal economic activities such as odd jobs, barter, and mutual aid provide partial recognition and essential livelihood support, albeit under precarious conditions. Third, we analyse how respondents actively manage institutional risks through covert strategies, combining welfare with informal work while navigating exposure to sanctions. These forms of constrained agency highlight how survival depends not only on available capital but on the capacity to manoeuvre within and between fields. We conclude that persistent structural poverty results primarily from institutional failures to recognise and convert existing forms of capital among people in poverty. We recommend policy interventions that formally acknowledge informal skills and facilitate capital conversion across the formal–informal divide, aiming to reduce symbolic exclusion and foster more inclusive pathways out of poverty.