Carneiro, Rafael Dix; Goldberg, Pinelopi K.; Meghir, Costas - National Bureau of Economic Research - 2021
. Heterogeneous firms sort into the formal or informal sector. We estimate the model using data from Brazil, and use counterfactual … unambiguously decreases informality in the tradable sector, but has ambiguous effects on aggregate informality. (2) The productivity … when informality is repressed. (4) Repressing informality increases productivity, but at the expense of employment and …