Effects of Colombia's Social Protection System on Workers' Choice between Formal and Informal Employment

Adriana Camacho, Emily Conover and Alejandro Hoyos Suarez

No 6003, Documentos CEDE from Universidad de los Andes, Facultad de Economía, CEDE

Abstract: We examine whether the Colombian government, when instituting and expanding social programs in the early nineties, inadvertently created incentives for people to become informal. We use data from repeated cross-sections of the Colombian Household Survey for periods before and after implementation of the reforms. As robustness, we also construct a panel of individuals interviewed for the first and second Census of the Poor. Using the variation in the onset of interviews across municipalities we find robust and consistent estimates of an increase in informal employment between 2 and 4 percentage points. From a policy perspective this implies that the broad expansion of government provided health insurance in Colombia contributed to increasing informal employment.

Keywords: Incentives; Informal Sector; Health Insurance; Social Protection; Colombia. (search for similar items in EconPapers)
JEL-codes: I11 I18 O17 (search for similar items in EconPapers)
Pages: 36
Date: 2009-08-02
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (23)

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https://repositorio.uniandes.edu.co/bitstream/handle/1992/8127/dcede2009-18.pdf

Related works:
Journal Article: Effects of Colombia's Social Protection System on Workers' Choice between Formal and Informal Employment (2014)
Working Paper: Effects of Colombia's social protection system on workers'choice between formal and informal employment (2013)
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Persistent link: https://EconPapers.repec.org/RePEc:col:000089:006003

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