IDEAS home Printed from https://ideas.repec.org/p/col/000092/015567.html

Employment and Efficiency Effects of Social Security (SS) and Social Protection (SP) Systems in the Context of an Informal Sector and Market Imperfections: A Conceptual Review

Author

Listed:
  • Albert Berry

Abstract

Most developing countries suffer serious “imperfections “in their labour, capital and product markets; a high level of informality (lack of connection with the state, e.g. non-registration, non-compliance with tax and labour regulations, etc.); and attempts to improve the welfare of specified groups through social security (SS) systems in the formal sector and (increasingly in recent years) through social protection systems (SP) designed to achieve greater overall coverage, e.g. to reach informal workers. Among the main policy issues that arise around the combined existence of these features are how to limit such negative effects as the market imperfections may have, how best to design SS and SP systems in such settings, and whether to pursue formalization be pursued as a policy and if so. The analysis of the impact of SP policies is very complicated and cannot be safely undertaken in a two sector (formal-informal) model, nor in one that assumes labour homogeneity or perfect competition in the product and capital markets. The analysis of any given case is likely to be complicated enough to pose serious barriers to the attainment of reliable conclusions, but is nonetheless worthwhile to narrow the range of uncertainty as to the impact of policy. For labour market functioning to have direct policy implications on the desirability of SP requires that labour allocation between the two (or among the three) sectors will respond to the presence of SP (as in non-queuing cases where the elasticity of formal demand for labour is not close to zero elasticity).

Suggested Citation

  • Albert Berry, 2017. "Employment and Efficiency Effects of Social Security (SS) and Social Protection (SP) Systems in the Context of an Informal Sector and Market Imperfections: A Conceptual Review," Documentos de Trabajo 15567, Universidad del Rosario.
    • Handle: RePEc:col:000092:015567
    as

    Download full text from publisher

    File URL: http://repository.urosario.edu.co/bitstream/item/88fc06d4-30b0-4e98-8b24-05c0f64ac2c4/dt198..pdf?sequence=1&isAllowed=y
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Dixit, Avinash K & Stiglitz, Joseph E, 1977. "Monopolistic Competition and Optimum Product Diversity," American Economic Review, American Economic Association, vol. 67(3), pages 297-308, June.
    2. Berry, R Albert, 1969. "A Note on Welfare Comparisons between Monopoly and Pure Competition," The Manchester School of Economic & Social Studies, University of Manchester, vol. 37(1), pages 39-57, March.
    3. repec:wbk:wbpubs:6730 is not listed on IDEAS
    4. Dipak Mazumdar, 1959. "The Marginal Productivity Theory of Wages and Disguised Unemployment," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 26(3), pages 190-197.
    5. Kaushik Basu & Amanda J. Felkey, 2009. "A theory of efficiency wage with multiple unemployment equilibria: how a higher minimum wage law can curb unemployment," Oxford Economic Papers, Oxford University Press, vol. 61(3), pages 494-516, July.
    6. Harris, John R & Todaro, Michael P, 1970. "Migration, Unemployment & Development: A Two-Sector Analysis," American Economic Review, American Economic Association, vol. 60(1), pages 126-142, March.
    7. Woodcock Simon D, 2010. "Heterogeneity and Learning in Labor Markets," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 10(1), pages 1-69, September.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Wapler, Rüdiger, 2001. "Unions, efficiency wages, and unemployment," Tübinger Diskussionsbeiträge 210, University of Tübingen, School of Business and Economics.
    2. Bose, Gautam, 1996. "Agrarian efficiency wages in a dual economy," Journal of Development Economics, Elsevier, vol. 49(2), pages 371-386, May.
    3. Batabyal, Amitrajeet & Higano, Yoshiro & Nijkamp, Peter, 2020. "Introduction to "Rural-Urban Dichotomies and Spatial Development in Asia"," MPRA Paper 103916, University Library of Munich, Germany, revised 02 Nov 2020.
    4. Jens Suedekum, 2005. "Increasing returns and spatial unemployment disparities," Papers in Regional Science, Wiley Blackwell, vol. 84(2), pages 159-181, June.
    5. repec:eee:labchp:v:3:y:1999:i:pb:p:2859-2939 is not listed on IDEAS
    6. Wapler, Rüdiger, 2000. "Unions, monopolistic competition and unemployment," Tübinger Diskussionsbeiträge 180, University of Tübingen, School of Business and Economics.
    7. repec:ilo:ilowps:267961 is not listed on IDEAS
    8. Dessing, Maryke, 2004. "Implications for minimum-wage policies of an S-shaped labor-supply curve," Journal of Economic Behavior & Organization, Elsevier, vol. 53(4), pages 543-568, April.
    9. Donald R. Davis & Trevor A. Reeve, 1997. "Human Capital, Unemployment and Relative Wages in a Global Economy," Harvard Institute of Economic Research Working Papers 1804, Harvard - Institute of Economic Research.
    10. Kondo, Illenin O., 2018. "Trade-induced displacements and local labor market adjustments in the U.S," Journal of International Economics, Elsevier, vol. 114(C), pages 180-202.
    11. Akira Nishimori, 1999. "Product Variety and Sector-specific Unemployment," Urban Studies, Urban Studies Journal Limited, vol. 36(9), pages 1467-1473, August.
    12. Breinlich, Holger & Ottaviano, Gianmarco I.P. & Temple, Jonathan R.W., 2014. "Regional Growth and Regional Decline," Handbook of Economic Growth, in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 2, chapter 4, pages 683-779, Elsevier.
    13. Cheng Chen, 2015. "Management Quality, Firm Organization and International Trade," 2015 Meeting Papers 53, Society for Economic Dynamics.
    14. Etsuro Shioji, 1995. "Regional allocation of skills," Economics Working Papers 143, Department of Economics and Business, Universitat Pompeu Fabra.
    15. Xi Yang, 2014. "Labor market frictions, agglomeration, and regional unemployment disparities," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 52(2), pages 489-512, March.
    16. Illenin Kondo, 2013. "Trade Reforms, Foreign Competition, and Labor Market Adjustments in the U.S," 2013 Meeting Papers 1302, Society for Economic Dynamics.
    17. Bharadwaj K., 1989. "Formation of rural labour markets: an analysis with special reference to Asia," ILO Working Papers 992679613402676, International Labour Organization.
    18. van Schaik, A.B.T.M. & de Groot, H.L.F., 2000. "Unemployment, growth and efficiency wages," Other publications TiSEM faa209e7-3a95-41b0-958f-0, Tilburg University, School of Economics and Management.
    19. Yenhuang Chen & Lihong Zhao, 2009. "Wage Subsidy and Sector-Specific Unemployment: A New Economic Geography Approach," Economics Bulletin, AccessEcon, vol. 29(1), pages 426-436.
    20. Sravaitri CHAUDHURI & Ranajoy BHATTACHARYYA & Sukanta BHATTACHARYA, 2021. "Rural urban migration with heterogeneous firms, heterogonous laborer and the effect of wage subsidy," Theoretical and Applied Economics, Asociatia Generala a Economistilor din Romania / Editura Economica, vol. 0(3(628), A), pages 143-156, Autumn.
    21. vom Berge, Philipp, 2011. "Search Unemployment and New Economic Geography," University of Regensburg Working Papers in Business, Economics and Management Information Systems 454, University of Regensburg, Department of Economics.
    22. J. Vernon Henderson, 2003. "Urbanization and Economic Development," Annals of Economics and Finance, Society for AEF, vol. 4(2), pages 275-341, November.

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;
    ;
    ;

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:col:000092:015567. See general information about how to correct material in RePEc.

    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 CitEc recognized a bibliographic reference but did not link an item in RePEc 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Facultad de Economía (email available below). General contact details of provider: https://edirc.repec.org/data/ferosco.html .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.