Informal Production and Labour Market Segmentation
An industry is modeled in which entrepreneurs, who are heterogeneous in ability, may produce formally or informally. Two cases are distinguished, with and without labour market segmentation, for which different patterns of formal/informal supply obtain. Without segmentation, informality may generate production where otherwise there would be none. Typically, however, a trade-off obtains: when informality makes output higher it cuts the profit of the most able entrepreneurs, potentially damaging growth. With segmentation, informality causes some replacement of 'good' jobs by 'bad,' and total employment may be affected in either direction; without segmentation the effect on total employment is weakly positive.
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.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Volume (Year): 167 (2011)
Issue (Month): 4 (December)
|Contact details of provider:|| Web page: https://www.mohr.de/jite|
|Order Information:|| Postal: Mohr Siebeck GmbH & Co. KG, P.O.Box 2040, 72010 Tübingen, Germany|
When requesting a correction, please mention this item's handle: RePEc:mhr:jinste:urn:sici:0932-4569(201112)167:4_686:ipalms_2.0.tx_2-r. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Thomas Wolpert)
If references are entirely missing, you can add them using this form.