|
on Informal and Underground Economics |
| By: | Jorge Alonso-Ortiz (Centro de Investigación Económica (CIE), Instituto Tecnológico Autónomo de México (ITAM)); Julio Leal (Banco de México) |
| Abstract: | We study the impact on the size of the informal sector of a tax levied on formal workers, and transfers that may be distributed to both formal and informal workers alike. We build a search model that features an informal sector and we calibrate it to data from Mexico. We investigate whether changes in size and distribution of transfers between formal and informal workers have a signicant impact on the size of the informal sector. We nd that changes in the distribution, for a given size, create a range of variation of 19.35pp. Analogously, changes in size create a range of variation of 5.7pp, resulting in a total range of variation of 51.2pp. This implies that it is possible to substantially increase formalization by rising extra tax resources as long as they accrue to formal workers. We illustrate the validity of our approach simulating the introduction of Seguro Popular. |
| Keywords: | Informal Sector, Search, Tax and Transfer Programs, Seguro Popular |
| JEL: | E24 E26 E62 J64 J65 |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:cie:wpaper:1308&r=iue |
| By: | Wagstaff, Adam; Nguyen, Ha Thi Hong; Dao, Huyen; Balesd, Sarah |
| Abstract: | Subsidized voluntary enrollment in government-run health insurance schemes is often proposed as a way of increasing coverage among informal sector workers and their families. This paper reports the results of a cluster randomized control trial in which 3,000 households in 20 communes in Vietnam were randomly assigned at baseline to a control group or one of three treatments: an information leaflet about Vietnam’s government-run scheme and the benefits of health insurance; a voucher entitling eligible household members to 25 percent off their annual premium; and both. The four groups were balanced at baseline. In the control group, 6.3 percent (82/1296) of individuals were enrolled in the endline, compared with 6.3 percent (79/1257), 7.2 percent (96/1327), and 7.0 percent (87/1245) in the information, subsidy, and combined intervention groups; the adjusted odds ratios were 0.94, 1.12, and 1.15, respectively. Only among those reporting poor health were any significant intervention effects found, and only for the combined intervention: an enrollment rate of 16.3 percent (33/202) compared with 8.3 percent (18/218) in the control group, and an adjusted odds ratio of 2.50. The results suggest limited opportunities to raise voluntary health insurance enrollment through information campaigns and subsidies, and that these interventions exacerbate adverse selection. |
| Keywords: | Health Monitoring&Evaluation,Health Economics&Finance,Health Systems Development&Reform,Health Law,Housing&Human Habitats |
| Date: | 2014–06–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:6910&r=iue |
| By: | Luis, Beccaria; Roxana, Maurizio; Vazquez, Gustavo |
| Abstract: | In the last decade Argentina experienced a process of wage inequality reduction that is in stark contrast with the trends of the previous decade. The purpose of this study is to analyze the contribution of different factors to this process. The method employed is a decomposition proposed by Firpo, Fortin and Lemieux (2007, 2011), which allows extending the Oaxaca-Blinder approach to decompose some distributive statistics of income between a ‘composition effect’ and a ‘returns effect’. Similar to other studies, the results reveal that declining returns to education have been a major factor explaining the improvement in the distribution of income observed in the 2003-2012 period. However, the process of labor formalization has also had an equalizing effect over the period. |
| Keywords: | Inequality, labor formalization, Oaxaca-Blinder, decomposition methods. |
| JEL: | D31 J31 |
| Date: | 2014–06–17 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:56701&r=iue |
| By: | Alan Gelb, Christian Meyer, and Vijaya Ramachandran |
| Abstract: | We consider economic development of Sub-Saharan Africa from the perspective of slow convergence of productivity, both across sectors and across firms within sectors. Why have “productivity enclaves”, islands of high productivity in a sea of smaller low-productivity firms, not diffused more rapidly? We summarize and analyze three sets of factors: First, the poor business climate, which constrains the allocation of production factors between sectors and firms. Second, the complex political economy of business-government relations in Africa’s small economies. Third, the distribution of firm capabilities. The roots of these factors lie in Africa’s geography and its distinctive history, including the legacy of its colonial period on state formation and market structure. |
| Keywords: | Productivity, Manufacturing, Dualism, Firms, Africa |
| JEL: | D24 L25 O11 O14 |
| Date: | 2014–02 |
| URL: | http://d.repec.org/n?u=RePEc:cgd:wpaper:357&r=iue |
| By: | John D. Conroy (Crawford School of Public Policy, The Australian National University) |
| Abstract: | This paper is concerned with the accommodation to the market economy of Tolai people, indigenous to the Gazelle Peninsula in Papua New Guinea and regarded as one of the most prosperous and enterprising groups in the country. 'The market' was introduced to Tolai by German (and later, Australian) colonists from the late nineteenth century. Without pretension to novelty in the historical narrative it asserts the value of viewing these events through the lens of 'informal economy', as constructed by Keith Hart. The paper is a companion piece to another study, concerned with the economic history of Chinese immigrants to Rabaul (Conroy, forthcoming). Starting from the proposition that (unlike the Chinese) the Tolai had no tradition of 'trade as a self-sufficient profession', it considers how they adapted their livelihoods to the colonial economy. In German New Guinea, market economic activity was supposed to be conducted in conformity with the norms of a particular model of Weberian 'rational-legal' bureaucracy, introduced by the Reich. In turn, German bureaucratic norms were guided by an ideology of 'national-economic purpose', enunciated for the Wilhelmine state and its colonies. The paper argues that subsequent Australian administrators adopted the German bureaucratic framework, while employing it initially for somewhat different ends and eventually (after World War II) adapting it to the needs of a new ideology of 'economic development'. Across this long period Tolai engagement in the market economy proved to be 'informal', in the sense that it did not conform fully with prescribed bureaucratic norms. It displayed the hybridity found wherever Smithian trade (seen as activated by a natural human tendency to 'truck and barter') is confronted by Maussian exchange (seen as the product of socially regulated customs). The paper considers how tensions between German/Australian expectations of Tolai economic behaviour and the reality of that behaviour played out over the colonial period to 1975. At the end of that time, trade as 'a self-sufficient profession' appeared to be confined to some instances of petty specialized trade amid signs of more general emerging change in trading culture. |
| JEL: | E26 N37 N57 N97 O17 P52 Z13 |
| Date: | 2014–05 |
| URL: | http://d.repec.org/n?u=RePEc:een:crwfrp:1405&r=iue |