Trade Liberalization And Informality: New Stylized Facts
AbstractThe relationship between trade liberalization and informal activity has not received the attention, whether theoretical or empirical, that it may deserve. The conventional view posits that trade liberalization would cause a rise in informality. This paper uses three different data sets to assess the sign of the relationship. Empirical results provide a mixed picture. Macro-founded data tend to produce results supporting the conventional view; micro-founded data do not. Empirical results also suggest that while informal output increases with deeper trade liberalization, informal employment falls.
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Bibliographic InfoPaper provided by United Nations Conference on Trade and Development in its series UNCTAD Blue Series Papers with number 43.
Date of creation: 2010
Date of revision:
Other versions of this item:
- Norbert Fiess & Marco Fugazza, 2008. "Trade Liberalisation and Informality: New stylized facts," Working Papers 2008_34, Business School - Economics, University of Glasgow.
- F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
- F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
- O17 - Economic Development, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements
- C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
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