Does household financial access facilitate law compliance? Evidence from Mexico

Emilio Gutierrez and Kensuke Teshima

Economics Letters, 2016, vol. 149, issue C, 120-124

Abstract: We investigate the impact of financial access on law compliance (whether workers are registered in a mandated social security system). In contrast to previous studies that focus on firms’ access to credit, we investigate workers’ access to credit. Exploiting the geographic variation in financial access due to Banco Azteca’s opening in Mexico in 2002 that changed financial access by poor people almost over-night, we find that financial access increased the probability of getting formalized.

Keywords: Financial access; Law compliance; Informality (search for similar items in EconPapers)
JEL-codes: G21 O12 O17 (search for similar items in EconPapers)
Date: 2016
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Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:149:y:2016:i:c:p:120-124

DOI: 10.1016/j.econlet.2016.10.025

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