This paper provides new evidence on the wage gap between informal and formal salary workers in South Africa, Brazil and Mexico. We use rich datasets that allow us to define informality in a relatively comparable fashion across countries. We compute precise wage differentials by accounting for...

This paper provides a detailed analysis of various dimensions of informality in the Mexican labor market. To understand the nature of informality in terms of regulations and compliance, the legalistic view, and in terms of productivity view of the labor market this paper makes an empirical...

This paper analyzes, using country-level panel data from transition economies and Latin America, the impact of labor market institutions on informal economic activity. The measure of informal economic activity is taken from Schneider et al. (2010), the most comprehensive study to date. The data...

This paper examines the macroeconomic interaction between informality and gender inequality in the labor market. A dynamic stochastic general equilibrium model is built to study the impact of gender-targeted policies on female labor force participation, female formal employment, gender wage gap,...

Labor earnings are the dominant income source for most individuals. Thus, an inclusive labor market is key for ensuring inclusive growth. In this paper we propose four principles that an inclusive labor market will embody: access, fairness, protection and voice. While measuring inclusivity...

Using data from the Vietnam Labor Force Survey, this paper takes a granular look at the most salient drivers of labor informality in Vietnam by examining: (i) the nature of labor informality and transitions from formal to informal employment status and the role of worker characteristics; (ii)...

This paper uses census and household survey data on Cameroon, Ghana, and South Africa to examine immigration's impact in the context of a segmented labor market in Sub-Saharan Africa. We find that immigration affects (i) employment (ii) employment allocation between informal and formal sectors,...

Employment is key to combating poverty. Thus, detractors of social assistance programs argue that they create disincentives to work. While there is substantial evidence showing limited effects of these programs on overall labor supply, the jury is still out with respect to their impact on formal...

Labor markets in Latin America and the Caribbean (LAC) are characterized by high levels of informality and relatively rigid regulation. This paper shows that these two features are related and together make the speed of adjustment of employment to shocks slower, especially when regulations are...

This paper reviews the literature on the informal economy, focusing first on empirical findings and then on existing approaches to modeling informality within both partial and general equilibrium environments. We concentrate on labour and credit markets, since these tend to be most affected by...