IDEAS home Printed from https://ideas.repec.org/a/taf/jitecd/v22y2013i4p477-508.html
   My bibliography  Save this article

Informality, tariffs and wealth

Author

Listed:
  • Nelson Correa
  • Michele Di Maio

Abstract

This article analyzes the interaction between changes in tariff protection, informality, inequality and aggregate income. First, we describe some new empirical evidence on informality, the formal/informal wage gap and trade openness in Latin American countries. Then we present a simple model characterized by three (empirically based) assumptions: (1) agents consume both formal and informal goods; (2) the government uses tariff revenues to purchase formal goods; (3) informality is a voluntary phenomenon. The model predicts that tariff reduction increases informality and wage inequality and that the maximization of income requires a positive level of tariff protection. The model's results are shown to be consistent with the empirical evidence concerning Latin American countries.

Suggested Citation

  • Nelson Correa & Michele Di Maio, 2013. "Informality, tariffs and wealth," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 22(4), pages 477-508, June.
    • Handle: RePEc:taf:jitecd:v:22:y:2013:i:4:p:477-508
    DOI: 10.1080/09638199.2011.590598
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1080/09638199.2011.590598
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/09638199.2011.590598?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. -, 2008. "Promoting corporate social responsibility in small and medium enterprises in the Caribbean: survey results," Studies and Perspectives – ECLAC Office in Washington 5067, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Weiss Fagen, Patricia, 2009. "The migration of health care workers in the Western Hemisphere: issues and impacts," Studies and Perspectives – ECLAC Office in Washington 5072, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
    2. Martha Ríos Manríquez & Celina López Mateo & Julián Ferrer Guerra, 2016. "Factorial Validation of a Corporate Social Responsibility Perception Scale for Micro, Small, and Medium Enterprises," Information Management and Business Review, AMH International, vol. 8(5), pages 25-38.
    3. Artecona, Raquel & Chau, Terence, 2017. "Labour issues in the digital economy," Studies and Perspectives – ECLAC Office in Washington 42046, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
    4. Bustillo, Inés & Velloso, Helvia, 2015. "Puerto Rico: Fiscal and economic growth challenges," Studies and Perspectives – ECLAC Office in Washington 39166, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
    5. Peter Turyakira, 2018. "Corporate Social Responsibility Activities that Influence Customer Loyalty of SMEs," International Journal of Business and Management, Canadian Center of Science and Education, vol. 13(6), pages 255-255, April.
    6. Artecona, Raquel & Bustillo, Inés, 2015. "Global financial rulemaking and small economies," Studies and Perspectives – ECLAC Office in Washington 38866, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
    7. Porzecanski, Arturo C., 2009. "Latin America: The Missing Financial Crisis," MPRA Paper 18780, University Library of Munich, Germany.
    8. -, 2010. "Millennium development goals: advances in environmentally sustainable development in Latin America and the Caribbean," Libros y Documentos Institucionales, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL), number 2937 edited by Eclac.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:jitecd:v:22:y:2013:i:4:p:477-508. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/RJTE20 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.