Trade liberalization, labor reforms and formal–informal employment dynamics

Mariano Bosch, Edwin Goñi-Pacchioni and William Maloney
Authors registered in the RePEc Author Service: Edwin Goni Pacchioni

Labour Economics, 2012, vol. 19, issue 5, 653-667

Abstract: This paper studies gross worker flows to explain the rise in informality in Brazilian metropolitan labor markets from 1983 to 2002. In particular, we examine the impact of trade and constitutional reforms (that include increased firing costs, tighter restrictions on overtime work, and fewer restrictions on union activity) occurring during the period. We find aggregate sectoral movements to be driven largely by changes in the hiring rates which, in turn are driven largely by the constitutional reforms. Trade liberalization accounts for roughly 1–2.5% of the increase in informality, while the constitutional reforms account for 30–40%.

Keywords: Gross worker flows; Labor market dynamics; Informality; Developing countries (search for similar items in EconPapers)
JEL-codes: F16 J23 J38 J63 J65 O17 (search for similar items in EconPapers)
Date: 2012
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (54)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:labeco:v:19:y:2012:i:5:p:653-667

DOI: 10.1016/j.labeco.2012.03.001

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