This paper studies the impact of product and labor market regulations on informality and unemployment in a general framework where formal and informal firms are subject to the same externalities, differing only with respect to some parameter values. Both formal and informal firms have monopoly...

Employment and job creation are key components in achieving economic growth and sustainable development, particularly in low-income countries. The growing size of the working-age population in many developing regions underscores the need to further strengthen labour market structures in the...