Social protection programs and employment: The case of Mexico’s “Seguro Popular” program
AbstractMexico created Seguro Popular in 2002 with the goal of providing free or subsidized health insurance coverage to 47 million uninsured people by the year 2013. Only individuals lacking the social security protections granted to all formal sector workers and their families are eligible. Hence, one unintended consequence of the program could be an increase in the size of the informal sector. The introduction of the Seguro Popular program was conducted in stages, across municipalities and time. We exploit this variation and implement a differences-in-differences approach in order to identify the causal effect of the program in formal employment outcomes. We analyze the effect of Seguro Popular using 33 large and relatively rich cities from labor force surveys conducted from 2001 to 2004. In order to measure the effect for poorer municipalities, we also use the individual-level Oportunidades dataset that covers 136 municipalities from 2002 to 2004. We find little evidence of any correlation between Seguro Popular and the decision of workers to be employed in the formal or informal sector. One possible explanation of our findings is the low enrollment of the Seguro Popular program during the period we study. We provide suggestive evidence from the 33 cities that the result holds for the 2005 to 2006 period as well. We conclude that the recent increase in informal employment in Mexico is due to other causes.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by El Colegio de México, Centro de Estudios Económicos in its series Serie documentos de trabajo del Centro de Estudios Económicos with number 2010-14.
Date of creation: Apr 2010
Date of revision:
Mexico; informality; employment;
Other versions of this item:
- Raymundo M. Campos-Vázquez & Melissa A. Knox, 2013. "Social Protection Programs and Employment: The Case of Mexico's Seguro Popular Program," Economia Mexicana NUEVA EPOCA, , vol. 0(2), pages 403-448, July-Dece.
- Raymundo M. Campos-Vazquez & Melissa A. Knox, . "Social Protection Programs and Employment: The Case of Mexico's Seguro Popular Program," Working Papers UWEC-2011-10, University of Washington, Department of Economics.
- J4 - Labor and Demographic Economics - - Particular Labor Markets
- O1 - Economic Development, Technological Change, and Growth - - Economic Development
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-01-16 (All new papers)
- NEP-DEV-2011-01-16 (Development)
- NEP-LAB-2011-01-16 (Labour Economics)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Adam Wagstaff, 2010.
"Social health insurance reexamined,"
John Wiley & Sons, Ltd., vol. 19(5), pages 503-517.
- Victoria Hosegood & Anne Case & Cally Ardington, 2009.
"Labor Supply Responses to Large Social Transfers: Longitudinal Evidence from South Africa,"
American Economic Journal: Applied Economics,
American Economic Association, vol. 1(1), pages 22-48, January.
- Cally Ardington & Anne Case & Victoria Hosegood, 2007. "Labor supply responses to large social transfers: Longitudinal evidence from South Africa," Working Papers 59, Economic Research Southern Africa.
- Cally Ardington & Anne Case & Victoria Hosegood, 2007. "Labor supply responses to large social transfers: Longitudinal evidence from South Africa," SALDRU Working Papers 17, Southern Africa Labour and Development Research Unit, University of Cape Town.
- Cally Ardington & Anne Case & Victoria Hosegood, 2007. "Labor Supply Responses to Large Social Transfers: Longitudinal Evidence from South Africa," NBER Working Papers 13442, National Bureau of Economic Research, Inc.
- Sebastian Galiani & Federico Weinschelbaum, 2007.
"Modeling Informality Formally: Households and Firms,"
CEDLAS, Working Papers
0047, CEDLAS, Universidad Nacional de La Plata.
- Sebastian Galiani & Federico Weinschelbaum, 2012. "Modeling Informality Formally: Households And Firms," Economic Inquiry, Western Economic Association International, vol. 50(3), pages 821-838, 07.
- Moffitt, Robert A., 2002.
"Welfare programs and labor supply,"
Handbook of Public Economics,
in: A. J. Auerbach & M. Feldstein (ed.), Handbook of Public Economics, edition 1, volume 4, chapter 34, pages 2393-2430
- repec:pri:rpdevs:1003 is not listed on IDEAS
- David H. Autor & John J. Donohue III & Stewart J. Schwab, 2003.
"The Costs of Wrongful-Discharge Laws,"
NBER Working Papers
9425, National Bureau of Economic Research, Inc.
- repec:pri:cheawb:1021 is not listed on IDEAS
- Hilary Hoynes, 1993.
"Welfare Transfers in Two-Parent Families: Labor Supply and Welfare Participation Under AFDC-UP,"
NBER Working Papers
4407, National Bureau of Economic Research, Inc.
- Hoynes, Hilary Williamson, 1996. "Welfare Transfers in Two-Parent Families: Labor Supply and Welfare Participation under AFDC-UP," Econometrica, Econometric Society, vol. 64(2), pages 295-332, March.
- Leonardo Gasparini & Francisco Haimovich & Sergio Olivieri, 2007. "Labor Informality Effects of a Poverty-Alleviation Program," CEDLAS, Working Papers 0053, CEDLAS, Universidad Nacional de La Plata.
- Gerardo Esquivel Hernández & Juan Luis Ordaz-Díaz, 2008. "¿Es la política social una causa de la informalidad en México?," Ensayos Revista de Economia, Universidad Autonoma de Nuevo Leon, Facultad de Economia, vol. 0(1), pages 1-32, May.
- Adriana Camacho & Emily Conover & Alejandro Hoyos, 2009.
"Effects of Colombia's Social Protection System on Workers' Choice between Formal and Informal Employment,"
006003, UNIVERSIDAD DE LOS ANDES-CEDE.
- Camacho, Adriana & Conover, Emily & Hoyos, Alejandro, 2013. "Effects of Colombia's social protection system on workers'choice between formal and informal employment," Policy Research Working Paper Series 6564, The World Bank.
- Reyes Aterido & Mary Hallward-Driemeier & Carmen Pagés-Serra, 2011.
"Does Expanding Health Insurance Beyond Formal-Sector Workers Encourage Informality?: Measuring the Impact of Mexico's Seguro Popular,"
81001, Inter-American Development Bank.
- Aterido, Reyes & Hallward-Driemeier, Mary & Pages, Carmen, 2011. "Does expanding health insurance beyond formal-sector workers encourage informality ? measuring the impact of Mexico's Seguro Popular," Policy Research Working Paper Series 5785, The World Bank.
- Aterido, Reyes & Hallward-Driemeier, Mary & Pagés, Carmen, 2011. "Does Expanding Health Insurance Beyond Formal-Sector Workers Encourage Informality? Measuring the Impact of Mexico's Seguro Popular," IZA Discussion Papers 5996, Institute for the Study of Labor (IZA).
- Arias, Javier & Artuc, Erhan & Lederman, Daniel & Rojas, Diego, 2013. "Trade, informal employment and labor adjustment costs," Policy Research Working Paper Series 6614, The World Bank.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Rocío Contreras Romo).
If references are entirely missing, you can add them using this form.