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Re-defining Informal Employment and Measuring its Determinants: Evidence from Russia

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Author Info

  • Lehmann, Hartmut

    ()
    (University of Bologna)

  • Zaiceva, Anzelika

    ()
    (University of Modena and Reggio Emilia)

Abstract

Informal activities impact countries' economic development and overall growth. However, studying informal employment is not easy and it is crucial to provide a valid definition of it. This paper contributes to the recent discussion of the measures of informality by taking advantage of a rich dataset on Russia over the period 2003 - 2011, that is before and after the economic downturn, together with a special supplement on informality that allows to construct different measures of informal employment and to analyze its determinants. We demonstrate that the incidence of informal employment varies across the different definitions. However, the determinants of informal employment are roughly stable across the different measures as long as we exclude firm size as a criterion. We also show that risk-averse individuals, as expected, are less likely to select themselves into informal employment.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 7844.

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Length: 43 pages
Date of creation: Dec 2013
Date of revision:
Handle: RePEc:iza:izadps:dp7844

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Keywords: informal employment; definitions; incidence; determinants; Russia;

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References

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  1. Maloney, William, 2003. "Informality revisited," Policy Research Working Paper Series 2965, The World Bank.
  2. Hartmut Lehmann & Norberto Pignatti, 2008. "Informal Employment Relationships and Labor Market Segmentation in Transition Economies: Evidence from Ukraine," ESCIRRU Working Papers 3, DIW Berlin, German Institute for Economic Research.
  3. Lehmann, Hartmut & Muravyev, Alexander & Razzolini, Tiziano & Zaiceva, Anzelika, 2013. "The wage and non-wage costs of displacement in boom times: Evidence from Russia," Journal of Comparative Economics, Elsevier, vol. 41(4), pages 1184-1201.
  4. Sabine Bernab? & Marco Stampini, 2008. "Labour mobility during transition: evidence from Georgia," LICOS Discussion Papers, LICOS - Centre for Institutions and Economic Performance, KU Leuven 20608, LICOS - Centre for Institutions and Economic Performance, KU Leuven.
  5. H. Lehmann & A. Muravyev, 2012. "Labor Market Institutions and Informality in Transition and Latin American Countries," Working Papers wp854, Dipartimento Scienze Economiche, Universita' di Bologna.
  6. Harris, John R & Todaro, Michael P, 1970. "Migration, Unemployment & Development: A Two-Sector Analysis," American Economic Review, American Economic Association, American Economic Association, vol. 60(1), pages 126-42, March.
  7. Slonimczyk, Fabian, 2011. "The effect of taxation on informal employment: evidence from the Russian flat tax reform," MPRA Paper 35404, University Library of Munich, Germany.
  8. V. Gimpelson & A. Zudina., 2011. "Informal Workers in the Russian Economy: Who Are They and How Many?," VOPROSY ECONOMIKI, N.P. Redaktsiya zhurnala "Voprosy Economiki", N.P. Redaktsiya zhurnala "Voprosy Economiki", vol. 10.
  9. Lucas, Robert Jr., 1988. "On the mechanics of economic development," Journal of Monetary Economics, Elsevier, Elsevier, vol. 22(1), pages 3-42, July.
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