The price of fringe benefits when formal and informal labor markets coexist

David Argente () and Jorge García ()

IZA Journal of Labor Economics, 2015, vol. 4, issue 1, 1-12

Abstract: We use the Mexican labor market structure to price the set of fringe benefits that household heads receive when formally employed. We exploit longitudinal, nationally-representative information on household heads who are formal, informal, or switch status at least once in our data. Using monthly labor income and an efficient markets hypothesis, we identify a standard linear model which accounts for time-variant household heads’ characteristics and household level and time fixed effects. Under the usual strict-exogeneity assumption, we find that the price of fringe benefits is approximately 7.9% of the average monthly labor income of informal workers, or $217 USD. JEL Classification:D4; J3; J4 Copyright Argente and García; licensee Springer. 2015

Keywords: Dual labor market; Fringe benefits; Informal labor market (search for similar items in EconPapers)
Date: 2015
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://hdl.handle.net/10.1186/s40172-014-0014-0 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:izalbr:v:4:y:2015:i:1:p:1-12:10.1186/s40172-014-0014-0

Ordering information: This journal article can be ordered from
http://www.springer.com/economics/journal/40172

DOI: 10.1186/s40172-014-0014-0

Access Statistics for this article

IZA Journal of Labor Economics is currently edited by Joni Hersch and Pierre Cahuc

More articles in IZA Journal of Labor Economics from Springer, Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA)
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().