Labor Informality: The Colombian Case

30 Pages Posted: 26 Feb 2010 Last revised: 1 Mar 2010

See all articles by Paola Marcela Roldan

Paola Marcela Roldan

Universidad del Norte

Carlos G. Ospino

Universidad de los Andes, Colombia - Department of Economics

Date Written: February 23, 2010

Abstract

In this article we explore factors related to the probability of being an informal worker in Colombia; in particular, we are interested in analyzing whether the time spent searching for a job affects in a significant manner the probability of being an informal worker. We also explore characteristics that affect wage differentials between formal and informal workers. The period of analysis comprehends second quarters of the continuous household surveys between 2001 and 2005, for 13 cities and metropolitan areas. We find evidence that unemployment duration has a positive effect on the probability of being an informal worker in Colombia. Household heads have a lower probability of being informal, due in great part to the fact that their social security affiliation guarantees her family access to health services. Informal workers, during the period of analysis earn labor income 30% lower than formal workers, after controlling for socioeconomics characteristics.

Note: Downloadable document is in Spanish.

Keywords: Informal workers, job searching, wage differentials

JEL Classification: O17, J31, J32

Suggested Citation

Roldan, Paola Marcela and Ospino, Carlos G., Labor Informality: The Colombian Case (February 23, 2010). Available at SSRN: https://ssrn.com/abstract=1557987 or http://dx.doi.org/10.2139/ssrn.1557987

Paola Marcela Roldan

Universidad del Norte ( email )

Km5 Via Puerto Colombia
Carrera 58 # 82-84 Apt 6B
Barranquilla, Atlantico
Colombia
+ 575 509509 (Phone)

HOME PAGE: http://www.uninorte.edu.co

Carlos G. Ospino (Contact Author)

Universidad de los Andes, Colombia - Department of Economics ( email )

Carrera 1a No. 18A-10
Santafe de Bogota, AA4976
Colombia

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