Informal Employment in a Growing and Globalizing Low-income Country

Brian McCaig and Nina Pavcnik

No 20891, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We document several facts about workforce transitions from the informal to the formal sector in Vietnam, a fast growing, industrializing, and low-income country. First, younger workers, particularly migrants, are more likely to work in the formal sector and stay there permanently. Second, the decline in the aggregate share of informal employment occurs through changes between and within birth cohorts. Third, younger, educated, male, and urban workers are more likely to switch to the formal sector than other workers initially in the informal sector. Poorly educated, older, female, rural workers face little prospect of formalization. Fourth, formalization coincides with occupational upgrading.

JEL-codes: F0 F16 J46 O12 (search for similar items in EconPapers)
Date: 2015-01
New Economics Papers: this item is included in nep-iue and nep-sea
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Published as Brian McCaig & Nina Pavcnik, 2015. "Informal Employment in a Growing and Globalizing Low-Income Country," American Economic Review, American Economic Association, vol. 105(5), pages 545-50, May.

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Journal Article: Informal Employment in a Growing and Globalizing Low-Income Country (2015)
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