On the Aggregate Implications of Removing Barriers to Formality

18 Pages Posted: 19 Aug 2020

See all articles by Catalina Granda Carvajal

Catalina Granda Carvajal

affiliation not provided to SSRN

Franz Hamann

Central Bank of Colombia

Date Written: May 1, 2020

Abstract

This article examines the aggregate implications of several policies aimed at removing barriers to formality. To this end, we build a dynamic equilibrium model in which heterogeneous agents choose to work for a wage or operate a technology in the formal or informal sector, based on the costs and benefits associated with these occupational choices.

JEL Classification: E26, H20, J30, L26, O17

Suggested Citation

Granda Carvajal, Catalina and Hamann, Franz, On the Aggregate Implications of Removing Barriers to Formality (May 1, 2020). FRB of St. Louis Working Paper No. Forthcoming, Available at SSRN: https://ssrn.com/abstract=3676536 or http://dx.doi.org/10.20955/r.102.203-20

Catalina Granda Carvajal (Contact Author)

affiliation not provided to SSRN

No Address Available

Franz Hamann

Central Bank of Colombia ( email )

Carrera 7 #14-78
3551 de Bogotá
Colombia

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