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Multiple Violations of Labor Market Regulations: Patterns in the Peruvian Labor Market and the Impact of Enforcement


  • Mariana Viollaz

    (Bank of Mexico)


This paper quantifies labor law violations and how the enforcement efforts impact on the compliance level by considering the possibility of different labor regulations being violated simultaneously. The findings for the Peruvian labor markets over the period 2004-2013 indicate that: (i) multiple violations of labor regulations are an important feature of Peruvian labor markets; (ii) young workers, workers with low level of education, indigenous workers, workers in micro firms and workers employed in the agricultural sector have higher chances of being deprived of several labor benefits simultaneously; (iii) the enforcement of labor regulations, captured through the number of labor inspections at the region level, is effective in detecting and penalizing extreme situations of multiple violations of the labor law, but the evidence also suggests that firms adjust only partially as an attempt to reduce the amount of a potential fine if discovered, and that laid off workers during the adjustment process moved to the informal sector where firms are not inspected. These findings are useful from a policy perspective indicating that there is space to improve firms’ incentives when facing an increase in the enforcement effort.

Suggested Citation

  • Mariana Viollaz, 2019. "Multiple Violations of Labor Market Regulations: Patterns in the Peruvian Labor Market and the Impact of Enforcement," CEDLAS, Working Papers 0244, CEDLAS, Universidad Nacional de La Plata.
  • Handle: RePEc:dls:wpaper:0244

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    References listed on IDEAS

    1. 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.
    2. Cruces, Guillermo & Fields, Gary S. & Jaume, David & Viollaz, Mariana, 2017. "Growth, Employment, and Poverty in Latin America," OUP Catalogue, Oxford University Press, number 9780198801085.
    3. Almeida, Rita K. & Poole, Jennifer P., 2017. "Trade and labor reallocation with heterogeneous enforcement of labor regulations," Journal of Development Economics, Elsevier, vol. 126(C), pages 154-166.
    4. Andrew Schrank, 2013. "Rewarding Regulation in Latin America," Politics & Society, , vol. 41(4), pages 487-495, December.
    5. Lucas Ronconi, 2010. "Enforcement and Compliance with Labor Regulations in Argentina," ILR Review, Cornell University, ILR School, vol. 63(4), pages 719-736, July.
    6. Mariana Viollaz, 2018. "Enforcement of labor market regulations: heterogeneous compliance and adjustment across gender," IZA Journal of Labor Policy, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 7(1), pages 1-28, December.
    7. Haroon Bhorat & Ravi Kanbur & Natasha Mayet, 2012. "Estimating the Causal Effect of Enforcement on Minimum Wage Compliance: The Case of S outh A frica," Review of Development Economics, Wiley Blackwell, vol. 16(4), pages 608-623, November.
    8. David WEIL, 2008. "A strategic approach to labour inspection," International Labour Review, International Labour Organization, vol. 147(4), pages 349-375, December.
    9. Almeida, Rita & Carneiro, Pedro, 2009. "Enforcement of labor regulation and firm size," Journal of Comparative Economics, Elsevier, vol. 37(1), pages 28-46, March.
    10. Mariana VIOLLAZ, 2018. "Are labour inspections effective when labour regulations vary according to the size of the firm? Evidence from Peru," International Labour Review, International Labour Organization, vol. 157(2), pages 213-242, June.
    11. Michael J. PIORE & Andrew SCHRANK, 2008. "Toward managed flexibility: The revival of labour inspection in the Latin world," International Labour Review, International Labour Organization, vol. 147(1), pages 1-23, March.
    12. Rita Almeida & Pedro Carneiro, Renata Narita, 2013. "Producing Higher Quality Jobs: Enforcement of Mandated Benefits across Brazilian Cities between 1996-2007," Working Papers, Department of Economics 2013_22, University of São Paulo (FEA-USP).
    13. Uma RANI & Patrick BELSER & Martin OELZ & Setareh RANJBAR, 2013. "Minimum wage coverage and compliance in developing countries," International Labour Review, International Labour Organization, vol. 152(3-4), pages 381-410, December.
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    More about this item

    JEL classification:

    • J81 - Labor and Demographic Economics - - Labor Standards - - - Working Conditions
    • J83 - Labor and Demographic Economics - - Labor Standards - - - Workers' Rights
    • J88 - Labor and Demographic Economics - - Labor Standards - - - Public Policy

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