There is no robust empirical support for the effect of financial incentives on the decision towork in self-employment rather than as a wage earner. In the literature, this is seen as apuzzle. We offer a focus on the opportunity cost, i.e. the wages given up as an employee.Information on income...

We study the impact of tax and minimum wage reforms on the incidence of informality. Togauge the incidence of informality, we use measures of the extent of tax evasion, the extentof minimum wage non-compliance, and the size of the informal workforce. Our approachallows us to examine (i) the...

It is argued that migration from Mexico to the US and its corresponding return migration aredetermined by international wage differentials and preferences for origin. We use a model ofjob search, savings and migration to show that job turnover is a crucial determinant of themigration process...

Using a matched firm-worker dataset, we show both theoretically and empirically that positiveassortative matching between firms...

Both raw intuition and past experience suggest that the success of an employment guaranteescheme (EGS) in safeguarding the welfare of the poor depends both on the wage itpromises, and the ease with which any worker can gain access. An EGS is thus at once awage guarantee and a rationing device....

In many countries, non-compliance with minimum wage legislation is widespread, andauthorities may be seen as having turned a blind eye to a legislation that they havethemselves passed. But if enforcement is imperfect, how effective can a minimum wage be?And if non-compliance is widespread, why...

To assess the employment effects of labor costs it is crucial to have reliable estimates of thelabor cost elasticity of labor demand. Using a matched firm-worker dataset, we estimate along run unconditional labor demand function, exploiting information on workers to correct forendogeneity in the...