Employment and Efficiency Effects of Social Security (SS) and Social Protection (SP) Systems in the Context of an Informal Sector and Market Imperfections: A Conceptual Review

Albert Berry ()

No 15567, Documentos de Trabajo from Universidad del Rosario

Abstract: Most developing countries suffer serious “imperfections “in their labour, capital and product markets; a high level of informality (lack of connection with the state, e.g. non-registration, non-compliance with tax and labour regulations, etc.); and attempts to improve the welfare of specified groups through social security (SS) systems in the formal sector and (increasingly in recent years) through social protection systems (SP) designed to achieve greater overall coverage, e.g. to reach informal workers. Among the main policy issues that arise around the combined existence of these features are how to limit such negative effects as the market imperfections may have, how best to design SS and SP systems in such settings, and whether to pursue formalization be pursued as a policy and if so. The analysis of the impact of SP policies is very complicated and cannot be safely undertaken in a two sector (formal-informal) model, nor in one that assumes labour homogeneity or perfect competition in the product and capital markets. The analysis of any given case is likely to be complicated enough to pose serious barriers to the attainment of reliable conclusions, but is nonetheless worthwhile to narrow the range of uncertainty as to the impact of policy. For labour market functioning to have direct policy implications on the desirability of SP requires that labour allocation between the two (or among the three) sectors will respond to the presence of SP (as in non-queuing cases where the elasticity of formal demand for labour is not close to zero elasticity).

Keywords: social security; social policy; informality; formalizatio; registration; labour market; capital market; product markets; regulations; market imperfections; economic efficiency (search for similar items in EconPapers)
Pages: 73
Date: 2017-04-14
New Economics Papers: this item is included in nep-iue
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://repository.urosario.edu.co/bitstream/item/8 ... quence=1&isAllowed=y

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:col:000092:015567

Access Statistics for this paper

More papers in Documentos de Trabajo from Universidad del Rosario Contact information at EDIRC.
Bibliographic data for series maintained by Facultad de Economía ().