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on Informal and Underground Economics |
| By: | Daniel Artana; Sebastián Auguste |
| Abstract: | El presente trabajo presenta un enfoque metodológico que permita medir a nivel de planta y sectores informalidad y productividad en forma conjunta de forma tal de poder entender mejor y testear las distintas hipótesis sobre la relación entre ambas variables. Se destaca que la decisión de ser formal o informal en general no es dicotómica, sino que es un matiz, y se decide en qué grado cumplir con las reglas. De todas las reglas, el informe pone énfasis en la informalidad impositiva. Se destaca que debido a la tecnología de evasión y de monitoreo de las agencias tributarias, distintas firmas pueden evadir en forma diferente en cada impuesto. De esta forma se requiere contar con una medida global de informalidad impositiva, en lugar de una medida de informalidad laboral, que ha sido lo más usual. La metodología se desarrolla teniendo en cuenta el uso de Censos Industriales. Estos Censos están sido crecientemente utilizados en la literatura económica para medir y analizar productividad, pero en general no han sido utilizados para medir informalidad. La metodología propuesta es una aproximación útil para entender la relación entre informalidad y productividad. |
| Keywords: | Economía :: Productividad, Sector público :: Estadísticas demográficas y sistemas de información, Economía :: Política fiscal |
| JEL: | E26 H26 O4 |
| Date: | 2011–05 |
| URL: | http://d.repec.org/n?u=RePEc:idb:brikps:25238&r=iue |
| By: | H. Lehmann; T. Razzolini; A. Zaiceva |
| Abstract: | Having unique data we investigate the link between job separations (displacement and quits) and informal employment, which we define in several ways posing the general question whether the burden of informality falls disproportionately on job separators in the Russian labor market. After we have established positive causal effects of displacement and quits on informal employment we analyze whether displaced workers experience more involuntary informal employment than their non-displaced counterparts. Our main results confirm our contention that displacement entraps some of the workers in involuntary informal employment. Those who quit, in turn, experience voluntary informality for the most part, but there seems a minority of quitting workers who end up in involuntary informal jobs. This scenario does not fall on all the workers who separate but predominantly on workers with low human capital. We also pursue the issue of informality persistence and find that informal employment is indeed persistent as some workers churn from one informal job to the next. Our study contributes to the debate in the informality literature regarding segmented versus integrated labor markets. It also contributes to the literature on displacement by establishing informal employment as an important cost of displacement. We also look at the share of undeclared wages in formal jobs and find that these shares are larger for separators than for incumbents, with displaced workers bearing the brunt of this manifestation of informality. |
| JEL: | J64 J65 P50 |
| Date: | 2011–12 |
| URL: | http://d.repec.org/n?u=RePEc:bol:bodewp:wp800&r=iue |
| By: | Alexander Hijzen |
| Abstract: | This paper analyses the impact of unemployment insurance and severance pay on the duration of nonemployment and transitions from non-employment to formal salaried employment, informal salaried employment and self-employment. It makes use of panel data from the Pesquisa Mensal de Emgrego, a monthly survey for six large cities in Brazil, for the period 2002M3 to 2010M10. The impact of income support to job losers is identified by means of a difference-in-differences approach that exploits eligibility conditions for income support in combination with proportional hazard models that take account of the spell-based nature of the data. A key aspect of the analysis is that it attempts to assess the role of moral hazard while controlling for the role of liquidity effects. The aggregate results indicate that income support has an important impact on the duration of non-employment. This largely appears to be driven by liquidity effects, while the role of moral hazard is limited. By contrast, the analysis by destination state suggests that moral hazard effects dominate liquidity effects associated with income support. The apparent inconsistency between the two sets of results is due to the fact that the aggregate analysis only accounts for moral hazard effects that increase the duration of nonemployment, while the analysis by destination state captures both moral hazard effects in the form of reduced work incentives per se and those in the form of increased incentives to work informally during the period of benefit receipt. In practice, the latter effect may reflect the tendency for firms to employ benefit recipients informally until their benefits expire.<BR>Ce document analyse l’impact de l’assurance chômage et des indemnités de licenciement sur la durée du chômage et la transition vers un emploi salarié dans le secteur formel ou informel, ou vers un emploi indépendant. L’analyse repose sur des données de panel comprises entre M3 2003 et M10 2010 tirées de l’enquête mensuelle sur l’emploi Pesquisa Mensal de Emprego qui concerne six grande zone urbaines du Brésil. Le test de l’incidence du soutien de revenu pour les chômeurs s’appuie sur la méthode de la différence des différences, exploitant les conditions d’éligibilité aux indemnités de soutien de revenu en combinaison avec des modèles de risque proportionnels qui tiennent compte de la nature épisodique des données. Un point essentiel de l’analyse est de tenter d’évaluer le rôle de l’aléa moral tout en tenant compte du rôle des effets de liquidités. Les résultats au niveau agrégé indiquent que le soutien des revenus a un impact important sur la durée du chômage. Il semble que ce résultat soit largement dû aux effets de liquidités, le rôle de l’aléa moral étant limité. En revanche, l’analyse par type d’emploi retrouvé suggère que les effets d’aléa moral dominent les effets de liquidité associés à la garantie de revenu. Cette contradiction apparente entre les deux groupes de résultats s’explique par le fait que l’analyse au niveau agrégé ne prend en compte que les effets d’aléa moral qui augmentent la durée du chômage, alors que l’analyse par destination capture à la fois les effets d’aléa moral qui se manifestent sous la forme d’une incitation réduite à reprendre un emploi, mais aussi ceux associés à l’incitation plus forte à travailler dans le secteur informel pendant la période d’indemnisation. En pratique, ce dernier effet pourrait refléter une tendance des entreprises à employer de manière informelle les bénéficiaires de prestations jusqu’à ce que leurs droits à indemnisation cessent. |
| Date: | 2011–12–12 |
| URL: | http://d.repec.org/n?u=RePEc:oec:elsaab:119-en&r=iue |
| By: | Veronica Amarante; Rodrigo Arim; Andres Dean |
| Abstract: | This paper considers the main institutional features of the Uruguayan labor market and its recent evolution, with a focus on unemployment. The main policies aimed at protecting workers against unemployment are analyzed. Using administrative data from social security records, the paper studies the dynamics of the labor market. Particularly examined are inflows and outflows from the formal labor market, as well as the effect, in terms of earnings loss, of episodes out of the formal labor market. Finally, an impact evaluation of recent changes in the unemployment insurance program is presented. |
| JEL: | J01 J08 |
| Date: | 2011–10 |
| URL: | http://d.repec.org/n?u=RePEc:idb:wpaper:4731&r=iue |
| By: | A. Marano; C. Mazzaferro; M. Morciano |
| Abstract: | Public pension systems based on the Notional Defined Contribution (NDC) principle were introduced during the ‘90s in Italy, Sweden and Poland, among other countries. They mimic private savings, in that individuals get back, as pensioners, what they contributed to social security during working life, plus returns. As such, NDC systems should realize actuarial equity and incentive neutrality. However, when one considers the presence of NDC pensions together with minimum and social assistance pensions, this is no longer true. Indeed, in all the three countries considered, the NDC system shows a regressive feature, which disincentivizes contributions, particularly from low earners, who would be better off entering, or staying in, the shadow economy. In order to reduce the extent of this phenomenon, we examine the effects of introducing, or increasing, the possibility of accumulation of social assistance and NDC pensions, which would also improve pension adequacy. A complete accumulation of the two would solve the incentive problem, but would be costly and would require a structural reform of the pension system financing mechanism, altering the current balance between social contributions and general fiscal revenues. We show the effects of a change in the cumulation rules for social assistance and NDC pensions in Italy using CAPP_DYN, a population-based dynamic microsimulation model, which allows assessment of the evolution of the pension system in the coming decades and the distributional implications of such reform. |
| JEL: | H55 J26 C51 |
| Date: | 2011–11 |
| URL: | http://d.repec.org/n?u=RePEc:bol:bodewp:wp799&r=iue |
| By: | Mathias Kuepie (CEPS/INSTEAD, UMR DIAL IRD Université Paris Dauphine); Christophe Nordman (IRD, UMR DIAL Université Paris Dauphine) |
| Abstract: | (english) The aim of this study is to analyze the impact of education on labor market entry, particularly on earnings in the two largest cities of the Republic of Congo. We examine firsthand data from the 2009 Congo's Employment and Informal Sector Survey (Enquête sur l’emploi et le secteur informel au Congo - EESIC) from a representative sample of about 3000 households in the cities of Brazzaville and Pointe-Noire. Results indicate that education is relatively widespread in both cities, with an average of about ten years of schooling. This phenomenon goes back a relatively long time, since even for the over 50 generations, more than eight out of ten adults completed primary school. The labor market itself is characterized by a large informal sector (where more than six out of ten working age people have an activity), which could potentially become a poverty trap and reflects high unemployment (especially among the youth), increasing with the level of education on the market. The Congolese urban labor market is also specifically characterized by the weight of the public sector, where almost one out of three people employed in the capital (Brazzaville) and a little over one out of five for both cities are employed. Therefore, the formal private sector is reduced to its congruent proportion. Multivariate analyses of the risk of unemployment and sectoral choice confirm that young people suffer greatly from lack of professional insertion: for most of these youth, their only choice is to remain unemployed or join the informal sector. To measure the specific impact of education on entry into various segments of the labor market, particularly on activity generated earnings, we directly address issues related to sample selection (related to the endogenous distribution among sectors) and the endogeneity of the education variable in the earnings function. Another important methodological challenge relates to the definition of the functional shape of the link that exists between earnings and the number of years of schooling. In the context of this study, we propose a piecewise linear function that allows variation in the marginal return to education when graduating from one educational cycle to another. With this specification, it is possible to emphasize the convexity of education returns; in other words, the last years in secondary and tertiary schooling yield the highest returns, while those of primary education are generally lower. This convexity is also apparent in the informal sector, where education (albeit on another scale) is also an important determinant of earnings. These results point to employment and poverty alleviation policies in the Republic of Congo. Policy proposals are thus developed in that regard throughout the study. _________________________________ (français) L’objectif de cette étude est d’analyser l’impact de l’éducation sur l’insertion sur le marché du travail et en particulier sur les rémunérations dans les deux principales métropoles de la République du Congo. Nous exploitons les données de première main de l’Enquête sur l’Emploi et le Secteur Informel au Congo (EESIC) de 2009 portant sur environ 3000 ménages représentatifs des villes de Brazzaville et de Pointe-Noire. Les résultats montrent que l’éducation est relativement répandue dans les deux villes, puisque le niveau moyen tourne autour de dix années d’études. Il s’agit d’un phénomène relativement ancien, car même dans les générations de plus de 50 ans, plus de huit adultes sur dix ont achevé le cycle primaire. Quant au marché du travail, il est marqué par une hypertrophie du secteur informel (plus de six actifs sur dix y exercent), qui constitue potentiellement une trappe à pauvreté et reflète un chômage élevé (surtout chez les jeunes) et croissant avec le niveau d’étude sur le marché. Le marché du travail urbain congolais présente aussi une caractéristique spécifique qui est le poids du secteur public, qui emploie presqu’un actif sur trois dans la capitale (Brazzaville) et un peu plus d’un sur cinq dans l’ensemble des deux villes. Le secteur privé formel y est donc réduit à la portion congrue. Des analyses multivariées sur le risque de chômage et l’orientation sectorielle confirment que les jeunes sont très défavorisés en matière d’insertion professionnelle : ces jeunes n’ont, pour la plupart, que le choix entre le chômage et le secteur informel. Pour mesurer l’effet propre du capital éducatif sur l’insertion dans les différents segments du marché du travail et en particulier sur les revenus de l’activité, nous abordons de front les problèmes de sélection d’échantillon (liée à l’allocation endogène entre les secteurs) et d’endogénéité de la variable d’éducation dans la fonction de revenu. Un autre défi méthodologique important concerne la spécification de la forme fonctionnelle du lien entre rémunération et années d’éducation. Dans le cadre de cette étude, nous proposons une fonction linéaire par morceaux, qui permet au rendement marginal de l’éducation de varier quand on passe d’un cycle à l’autre. Cette spécification permet de mettre en évidence le caractère convexe des rendements de l’éducation, c'est-à-dire que les dernières années du lycée et du supérieur sont les plus rentables alors que les rendements du primaire sont généralement plus faibles. Cette convexité s’observe même dans le secteur informel dans lequel l’éducation (certes à une autre échelle) est également un important déterminant des gains. Ces résultats interpellent les politiques d’emploi et de lutte contre la pauvreté à Congo-Brazzaville. Des propositions de politiques sont ainsi développées dans ce sens tout au long de l’étude. |
| Keywords: | Participation au marché du travail, Chômage, Rendements de l’éducation, Fonctions de gains, Secteur informel, Congo-Brazzaville,Labor market participation, Unemployment, Returns to education, Earnings functions, Informal sector,Congo-Brazzaville. |
| JEL: | J24 J31 O12 |
| Date: | 2011–10 |
| URL: | http://d.repec.org/n?u=RePEc:dia:wpaper:dt201111&r=iue |
| By: | Clarke, George |
| Abstract: | It is difficult to be sure that managers in developing countries report financial information accurately and truthfully during firm surveys. The most common concern is that managers might under-report performance to avoid attracting attention from the tax authorities or corrupt bureaucrats. Using a method developed in the literature on corruption, this paper identifies managers who appear to be reticent or deceptive and compares their answers with the answers of non-reticent managers. The paper shows that reticent managers report that their firms are more, not less, productive than non-reticent managers. The paper then assesses possible reasons for this, finding that the most likely explanation is that reticent managers exaggerate performance so that they or their firms look good. Because past studies have found that reticent managers appear to lie about other aspects of firm and manager behavior—including underreporting corruption—this suggests that it will be difficult to fully assess how these behaviors affect firm performance unless reticence is controlled for. |
| Keywords: | Reticence; Nigeria; Firm Surveys; Corruption; Labor Productivity |
| JEL: | D73 C42 O12 |
| Date: | 2011–12–11 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:35382&r=iue |
| By: | Maria Angelica Arbelaez; Roberto Steiner; Alejandro Becerra; Daniel Wills |
| Abstract: | Using the 2003 and 2008 Quality of Life Surveys, this paper identifies the factors that affect housing tenure decisions in Colombia. Households with higher incomes are more likely to purchase than to rent, and the choice of formal housing is positively associated with wealth. Households eligible for social housing subsidies are more likely to purchase than to rent, and those working in the informal sector are more likely to purchase informal dwellings. Subsidies and access to mortgage credit have a large positive impact on demand. Finally, savings have a positive effect on demand in 2008, but not in 2003. The positive effect on demand of both subsidies and credit is explained by demand for low- income housing. |
| JEL: | G21 O54 R21 R28 R38 R58 |
| Date: | 2011–10 |
| URL: | http://d.repec.org/n?u=RePEc:idb:wpaper:4736&r=iue |
| By: | Ours, J.C. van (Tilburg University, Center for Economic Research) |
| Abstract: | In almost all countries supply, distribution and use of cannabis is prohibited. Nevertheless, cannabis is the most popular illicit drug. Prohibition does not seem to work. The debate on legalization of cannabis is often emotional with strong views of both proponents and opponents but ignorance prevails. There are supposedly detrimental health effects of cannabis use but researchers debate whether they are causal or mere associations. As long as nowhere in the world cannabis is legalized it is difficult to get a clear idea about the effects of legalization. Rather than muddling through for several decades it would be wise to start moving on the long and winding road to cannabis legalization. |
| Keywords: | Cannabis use;Effects of use;cannabis legalization. |
| JEL: | I18 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:kubcen:2011126&r=iue |