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  • Author: Jorge Ignacio Del Castillo Machicado
  • Publication Date: 04-2020
  • Content Type: Working Paper
  • Institution: Institute for Advanced Development Studies (INESAD)
  • Abstract: This article researches on the evolution of the business regulatory framework of Bolivia from 2006 to 2017 and its relationship with the country’s Labor productivity, Total Factor Productivity, and its Informal Economy size. To do this, it analyzes the Doing Business annual reports and standardizes each year overall score to the most recent methodology developed by the World Bank Group. Furthermore, it complements its finding with qualitative data through semi-structured interviews to key actors in the Bolivian economy. Overall, this paper finds that few steps have been taken to improve Bolivia’s Business regulatory framework from the period of 2006-2017, result in a lower rank in the Doing Business report and keeping its score constant. The lack of initiative in working towards more efficient policies, complex nature and poor adaptability of new technological practices have stagnated the improvements of business regulations along their lifecycles. As a consequence, Bolivia Total Factor Productivity, Informal Economy size and Labor productivity have shown no improvement over the last 10 years.
  • Topic: Economics, Science and Technology, Labor Issues, World Bank, Regulation, Business
  • Political Geography: Latin America, Bolivia
  • Author: Miguel Jaramillo, Hugo Nopo
  • Publication Date: 06-2020
  • Content Type: Working Paper
  • Institution: Group for the Analysis of Development (GRADE)
  • Abstract: Latin America is currently suffering from two independent but related shocks: the impact of COVID-19 and the shock of commodity prices. Peru, we argue, is a case in which the strongest impact comes from the pandemic. Peru was the first country in Latin America to react and implement sanitary and economic measures against the coronavirus. The country has been in mandatory quarantine since Monday, March 16. This carries very important challenges for all economic actors. Global and national activity has suffered a sudden stop with direct implications for: (i) the income generating capacity of independent workers, (ii) the jobs of formal and informal and informal workers, and (iii) the survival of small, medium and large companies. In this note we consider the situation of Peruvian households in the face of the pandemic, exploring their vulnerabilities through an analysis of their main source of income generation: work. We also consider the situation of the companies that employ the workers under analysis. We present an overview of what the government’s main action have been so far and offer some recommendations.
  • Topic: Economics, Political Economy, Economic Policy, Coronavirus, Pandemic, COVID-19
  • Political Geography: Latin America, Peru
  • Author: Garcia Isabella
  • Publication Date: 09-2019
  • Content Type: Working Paper
  • Institution: Centre for Global Political Economy, University of Sussex
  • Abstract: In 2018/2019 the CGPE launched an annual Gender & Global Political Economy Undergraduate Essay Prize competition, open to all undergraduate students within the School of Global Studies. The winner of the 2018/2019 competition is Isabella Garcia for the essay “How do global supply chains exacerbate gender-based violence against women in the Global South?” Isabella graduated with a BA in International Relations and Development in July and will join the MA cohort in our Global Political Economy programme for 2019/2020. Given the very strong field of submissions, the award committee further decided to award a second-place prize to Yume Tamiya for the essay “Does the rise of the middle class disguise existing inequalities in Brazil?”. Yume graduated with a BA in International Development with International Education and Development. We are delighted to publish both of these excellent essays in the CGPE Working Paper series.
  • Topic: Economics, Gender Issues, Women, Gender Based Violence , Global South
  • Political Geography: Africa, Latin America, Mexico, Democratic Republic of Congo
  • Author: Yume Tamiya
  • Publication Date: 09-2019
  • Content Type: Working Paper
  • Institution: Centre for Global Political Economy, University of Sussex
  • Abstract: In 2018/2019 the CGPE launched an annual Gender & Global Political Economy Undergraduate Essay Prize competition, open to all undergraduate students within the School of Global Studies. The winner of the 2018/2019 competition is Isabella Garcia for the essay “How do global supply chains exacerbate gender-based violence against women in the Global South?” Isabella graduated with a BA in International Relations and Development in July and will join the MA cohort in our Global Political Economy programme for 2019/2020. Given the very strong field of submissions, the award committee further decided to award a second-place prize to Yume Tamiya for the essay “Does the rise of the middle class disguise existing inequalities in Brazil?”. Yume graduated with a BA in International Development with International Education and Development. We are delighted to publish both of these excellent essays in the CGPE Working Paper series.
  • Topic: Development, Economics, Inequality, Economic growth
  • Political Geography: Brazil, Latin America
  • Author: Onil Banerjee, Martin Cicowiez, Renato Vargas, Mark Horridge
  • Publication Date: 10-2019
  • Content Type: Working Paper
  • Institution: Center for Distributive, Labor and Social Studies (CEDLAS)
  • Abstract: In 2014, the United Nations published the first International Standard for environmental economic statistics, known as the System of Environmental-Economic Accounting (SEEA).. As more countries adopt and implement the SEEA, the availability of consistent environmental and economic information increases the need for analytical tools that can use this data to respond to policy relevant questions. In this paper, we present a workflow to develop an environmentally extended social accounting matrix, which can serve as the basic database for the development of environmentally-extended computable general equilibrium models. To illustrate, and given its comprehensive implementation of the SEEA, we apply this workflow to the Guatemalan case and the Integrated Economic-Environmental Modeling (IEEM) Platform.
  • Topic: Economics, United Nations, Basic Data, Accountability, Economic Policy, Statistics
  • Political Geography: South America, Latin America, Central America, Guatemala, Global Focus
  • Author: Leonardo Peñaloza Pacheco
  • Publication Date: 07-2019
  • Content Type: Working Paper
  • Institution: Center for Distributive, Labor and Social Studies (CEDLAS)
  • Abstract: The aim of this paper is to estimate the causal effect of the migration of Venezuelans to Colombia on the Colombian real wage, since 2016. In the second semester of 2016, the borders between Colombia and Venezuela were reopened after a year of being closed due to a political crisis between the two countries; this re-opening is exploited as an identification strategy. Using data from the Unidad Administrativa Especial de Migraci´on Colombia and the Registro Administrativo de Migrantes Venezolanos in Colombia, it is estimated that the migratory flow of Venezuelans to Colombia increased the Economically Active Population of the border areas of La Guajira and Norte de Santander by approximately 10% and 15%, since its reopening. Differences-in-differences methodology and Synthetic Control Method are implemented and the results show that the increase in labor supply in these regions that resulted from the migratory flow generated a decline in real hourly wages of approximately 6%-9% on average. This decrease in real wages appears to be greater for men as compared to women. There is also evidence of a greater drop in real wages among people with lower levels of qualification and in conditions of informal employment.
  • Topic: Economics, Migration, Political Economy, Labor Issues, Employment, Income Inequality
  • Political Geography: Colombia, Latin America, Venezuela
  • Author: Mariana Marchionni, María Edo, Dolores de la Mata, Lucila Berniell, Inés Berniell
  • Publication Date: 06-2019
  • Content Type: Working Paper
  • Institution: Center for Distributive, Labor and Social Studies (CEDLAS)
  • Abstract: Recent work has quantified the large negative effects of motherhood on female labor market outcomes in Europe and the US. But these results may not apply to developing countries, where labor markets work differently and informality is widespread. In less developed countries, informal jobs, which typically include microenterprises and self-employment, offer more time flexibility but poorer social protection and lower labor earnings. These characteristics affect the availability of key inputs in the technology to raise children, and therefore may affect the interplay between parenthood and labor market outcomes. Through an event-study approach we estimate short and long-run labor market impacts of children in Chile, an OECD developing country with a relatively large informal sector. We find that the birth of the first child has strong and long lasting effects on labor market outcomes of Chilean mothers, while fathers remain unaffected. Becoming a mother implies a sharp decline in mothers’ labor supply, both in the extensive and intensive margins, and in hourly wages. We also show that motherhood affects the occupational structure of employed mothers, as the share of jobs in the informal sector increases remarkably. In order to quantify what the motherhood effect would have been in the absence of an informal labor market, we build a quantitative model economy, that includes an informal sector which offers more flexible working hours at the expense of lower wages and weaker social protection, and a technology to produce child quality that combines time, material resources and the quality of social protection services. We perform a counterfactual experiment that indicates that the existence of the informal sector in Chile helps to reduce the drop in LFP after motherhood in about 35%. We conclude that mothers find in the informal sector the flexibility to cope with both family and labor responsibilities, although at the cost of resigning contributory social protection and reducing their labor market prospects.
  • Topic: Economics, Gender Issues, Political Economy, Women
  • Political Geography: Latin America, Chile
  • Author: Mariana Viollaz
  • Publication Date: 04-2019
  • Content Type: Working Paper
  • Institution: Center for Distributive, Labor and Social Studies (CEDLAS)
  • Abstract: This paper quantifies labor law violations and how the enforcement efforts impact on the compliance level by considering the possibility of different labor regulations being violated simultaneously. The findings for the Peruvian labor markets over the period 2004-2013 indicate that: (i) multiple violations of labor regulations are an important feature of Peruvian labor markets; (ii) young workers, workers with low level of education, indigenous workers, workers in micro firms and workers employed in the agricultural sector have higher chances of being deprived of several labor benefits simultaneously; (iii) the enforcement of labor regulations, captured through the number of labor inspections at the region level, is effective in detecting and penalizing extreme situations of multiple violations of the labor law, but the evidence also suggests that firms adjust only partially as an attempt to reduce the amount of a potential fine if discovered, and that laid off workers during the adjustment process moved to the informal sector where firms are not inspected. These findings are useful from a policy perspective indicating that there is space to improve firms’ incentives when facing an increase in the enforcement effort.
  • Topic: Economics, Labor Issues, Law Enforcement, Law, Regulation, Labor Policies, Economic Policy
  • Political Geography: Latin America, Peru
  • Author: Miriam Berges, Federico Perali, Martina Menon, Lucía Echeverria
  • Publication Date: 01-2019
  • Content Type: Working Paper
  • Institution: Center for Distributive, Labor and Social Studies (CEDLAS)
  • Abstract: Are two parents and single parents allocating household resources to children in the same way? Which factors affect intra-household inequality? Do mothers re-distribute more income to children as they are more empowered? We focus on child welfare in the context of two parent and single parent families, which is relevant for policy recommendation. We model households behavior in a collective framework, which allows us to understand the rule governing the allocation process between adults and children. Using consumption data from Argentina from three consecutive expenditures surveys (1996, 2004 and 2012) we analyze intra-household behavior over three different socio-economic contexts. We estimate a collective quadratic demand system following a structural approach to identify the fraction of total household expenditure that is devoted to children and adults, exploiting the observability of assignable goods. We provide the first evidence of intra-household inequality and individual poverty levels for Argentina. Our results indicate that family structure matters in the intra-household distribution. We find a positive gender bias in expenditure when children are females for both types of families, and we document that children fare better when mothers have a higher bargaining power in the allocation process, measured by their employment status. Further, we find several features of intra-household behavior which are persistent in time.
  • Topic: Economics, Political Economy, Children, Income Inequality, Child Poverty, Family
  • Political Geography: Argentina, Latin America
  • Author: Jorge Tamayo, Anant Nyshadham, Carlos Medina, Gaurav Khanna
  • Publication Date: 08-2019
  • Content Type: Working Paper
  • Institution: Empirical Studies of Conflict Project (ESOC)
  • Abstract: Canonical models of crime emphasize economic incentives. Yet, causal evidence of sorting into criminal occupations in response to individual-level variation in incentives is limited. We link administrative socioeconomic microdata with the universe of arrests in Medellίn over a decade. We exploit exogenous variation in formal-sector employment around a socioeconomic-score cutoff, below which individuals receive benefits if not formally employed, to test whether a higher cost to formal-sector employment induces crime. Regression discontinuity estimates show this policy generated reductions in formal-sector employment and a corresponding spike in organized crime, but no effects on crimes of impulse or opportunity.
  • Topic: Crime, Economics, Political Economy, Labor Issues
  • Political Geography: Colombia, Latin America