The Determinants of Informality in Mexico's States

Sean Doughertyi ; Octavio Escobarii iOECDiiESG Management School of Paris

Organisation for Economic Co-operation and Development

关键词: regulatory policy;    microenterprises;    sub-national policy analysis;    informal employment;   

DOI  :  https://doi.org/10.1787/5k483jrvnjq2-en

学科分类：社会科学、人文和艺术（综合）

来源: OECD iLibrary

【 摘 要 】

Informality has important implications for productivity, economic growth, and the inequality of income. In recent years, the extent of informal employment has increased in many of Mexico's states, though highly heterogeneously. The substantial differences across states in terms of informal employment can be helpful in explaining differences in economic growth outcomes. This paper studies the determinants of informal employment using states' diverging outcomes to identify causal factors, taking into account potential endogeneity. The results suggest that multiple factors explain differences in informal employment across states, including per capita income, the quality of labour skills, differences in the prevalence of microenterprises, the cost to start a business, restrictions on foreign investment, the rule of law and incidence of corruption.