Advanced Search
MyIDEAS: Login

Informal workers across Europe : evidence from 30 European countries

Contents:

Author Info

  • Hazans, Mihails

Abstract

The European Social Survey data are used to analyze informal employment in 30 countries, focusing on employees without contracts and on informal self-employed workers (who are distinguished from formal workers). Overall the size of informal employment decreases from South to West to East to North. However, working without a contract is more prevalent in Eastern Europe than in the West, except for Ireland, the United Kingdom, and Austria. Between 2004 and 2009, no cases were found when unemployment and dependent informality rates in a country went up together, suggesting that working without a contract is pro-cyclical in Europe. The dependent informality rate is inversely related to skills (measured by either schooling or occupation). Both in Southern and in Western Europe, the highest dependent informality rate is found among immigrants from Central and Eastern Europe and the Former Soviet Union, while in Eastern Europe this group is second after minorities without immigrant background. In the Southern and part of Western Europe, immigrants not covered by European Union free mobility provisions are much more likely to work without a contract than otherwise similar natives. The paper provides evidence that exclusion and discrimination plays an important role in pushing employees into informality, while this seems not to be the case for informal self-employed workers. Both on average and after controlling for a rich set of individual characteristics, informal employees in all parts of Europe are having the largest financial difficulties among all categories of the employed population (yet they fare much better than the unemployed and discouraged), while informal self-employed workers are at least as well off as formal employees. Finally, there is a negative and significant effect of individual-level satisfaction with the national government on the propensity to work without a contract in Eastern Europe, as well as in Western Europe.

Download Info

If 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.
File URL: http://www-wds.worldbank.org/servlet/WDSContentServer/WDSP/IB/2011/12/13/000158349_20111213090401/Rendered/PDF/WPS5912.pdf
Download Restriction: no

Bibliographic Info

Paper provided by The World Bank in its series Policy Research Working Paper Series with number 5912.

as in new window
Length:
Date of creation: 01 Dec 2011
Date of revision:
Handle: RePEc:wbk:wbrwps:5912

Contact details of provider:
Postal: 1818 H Street, N.W., Washington, DC 20433
Phone: (202) 477-1234
Email:
Web page: http://www.worldbank.org/
More information through EDIRC

Related research

Keywords: Labor Markets; Work&Working Conditions; Labor Policies; Labor Management and Relations; Tertiary Education;

This paper has been announced in the following NEP Reports:

References

References listed on IDEAS
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.:
as in new window
  1. Maloney, William, 2003. "Informality revisited," Policy Research Working Paper Series 2965, The World Bank.
  2. Bosch, Mariano & Goni, Edwin & Maloney, William F., 2007. "The Determinants of Rising Informality in Brazil: Evidence from Gross Worker Flows," IZA Discussion Papers 2970, Institute for the Study of Labor (IZA).
  3. Martin Kahanec & Anzelika Zaiceva & Klaus F. Zimmermann, 2010. "Ethnic Minorities in the European Union: An Overview," Discussion Papers of DIW Berlin 1090, DIW Berlin, German Institute for Economic Research.
  4. Muravyev, Alexander, 2010. "Evolution of Employment Protection Legislation in the USSR, CIS and Baltic States, 1985-2009," IZA Discussion Papers 5365, Institute for the Study of Labor (IZA).
  5. Hazans, Mihails, 2011. "What Explains Prevalence of Informal Employment in European Countries: The Role of Labor Institutions, Governance, Immigrants, and Growth," IZA Discussion Papers 5872, Institute for the Study of Labor (IZA).
  6. Friedrich Schneider, 2004. "Shadow Economies around the World: What do we really know?," IAW Discussion Papers 16, Institut für Angewandte Wirtschaftsforschung (IAW).
  7. Bosch, Mariano & Maloney, William F., 2010. "Comparative analysis of labor market dynamics using Markov processes: An application to informality," Labour Economics, Elsevier, vol. 17(4), pages 621-631, August.
  8. Jonasson, Erik, 2010. "Government Effectiveness and Regional Variation in Informal Employment," Working Papers 2010:13, Lund University, Department of Economics, revised 31 Mar 2011.
  9. Henley, Andrew & Arabsheibani, G. Reza & Carneiro, Francisco G., 2006. "On defining and measuring the informal sector," Policy Research Working Paper Series 3866, The World Bank.
  10. Yannis Georgellis & Howard J. Wall, 2004. "Gender differences in self-employment," Working Papers 1999-008, Federal Reserve Bank of St. Louis.
  11. Friedrich Schneider & Andreas Buehn & Claudio E. Montenegro, 2010. "Shadow Economies All over the World: New Estimates for 162 Countries from 1999 to 2007," Working Papers wp322, University of Chile, Department of Economics.
  12. Le, Anh T. & Miller, Paul W. & Slutske, Wendy S. & Martin, Nicholas G., 2010. "Attitudes towards Economic Risk and the Gender Pay Gap," IZA Discussion Papers 5393, Institute for the Study of Labor (IZA).
  13. Thomas Leoni & Martin Falk, 2010. "Gender and field of study as determinants of self-employment," Small Business Economics, Springer, vol. 34(2), pages 167-185, February.
  14. Kamila Fialová, 2010. "Labor Institutions and their Impact on Shadow Economies in Europe," Working Papers IES 2010/29, Charles University Prague, Faculty of Social Sciences, Institute of Economic Studies, revised Dec 2010.
  15. Tito Boeri & Pietro Garibaldi & Marta Ribeiro, 2010. "The Lighthouse Effect and Beyond," Carlo Alberto Notebooks 193, Collegio Carlo Alberto.
  16. Martin Kahanec & Anzelika Zaiceva, 2009. "Labor market outcomes of immigrants and non-citizens in the EU: An East-West comparison," International Journal of Manpower, Emerald Group Publishing, vol. 30(1/2), pages 97-115, May.
  17. Ekelund, Jesper & Johansson, Edvard & Jarvelin, Marjo-Riitta & Lichtermann, Dirk, 2005. "Self-employment and risk aversion--evidence from psychological test data," Labour Economics, Elsevier, vol. 12(5), pages 649-659, October.
  18. 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.
Full references (including those not matched with items on IDEAS)

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Hazans, Mihails, 2011. "What explains prevalence of informal employment in European countries : the role of labor institutions, governance, immigrants, and growth," Policy Research Working Paper Series 5917, The World Bank.
  2. Koettl, Johannes & Weber, Michael, 2012. "Does Formal Work Pay? The Role of Labor Taxation and Social Benefit Design in the New EU Member States," IZA Discussion Papers 6313, Institute for the Study of Labor (IZA).
  3. Hazans, Mihails, 2011. "Informal Workers across Europe: Evidence from 30 Countries," IZA Discussion Papers 5871, Institute for the Study of Labor (IZA).
  4. Johannes Koettl & Truman Packard & Claudio E. Montenegro, 2012. "In From the Shadow : Integrating Europe's Informal Labor," World Bank Publications, The World Bank, number 9377, September.
  5. Amélie Barbier-Gauchard & Francesco De Palma & Giuseppe Diana, 2012. "Currency devaluation with dual labor market : Which perspectives for the Euro Zone ?," Working Papers of BETA 2012-04, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:wbk:wbrwps:5912

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Roula I. Yazigi).

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 references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link 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 profile, as there may be some citations waiting for confirmation.

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