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Poverty and informality in Ecuador

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  • Carla Canelas

Abstract

This paper uses national representative data from the Ecuadorian Family Expenditure survey to study the determinants of poverty and informality in the country, taking into account the simultaneous two-way relationship between these two phenomena. The results support the view of a heterogeneous informal market, where informal work is both a demand-led phenomenon as well as a voluntary and primarily supply-led form of employment. As such, informal salaried work and self-employment are both a last resort option for low-skilled workers and a voluntary choice for the more educated and entrepreneurial ones.

Suggested Citation

  • Carla Canelas, 2015. "Poverty and informality in Ecuador," WIDER Working Paper Series 112, World Institute for Development Economic Research (UNU-WIDER).
  • Handle: RePEc:unu:wpaper:wp2015-112
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    File URL: https://www.wider.unu.edu/sites/default/files/wp2015-112.pdf
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    References listed on IDEAS

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    6. Fields, Gary S., 1975. "Rural-urban migration, urban unemployment and underemployment, and job-search activity in LDCs," Journal of Development Economics, Elsevier, vol. 2(2), pages 165-187, June.
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    8. Amuedo-Dorantes, Catalina, 2004. "Determinants and Poverty Implications of Informal Sector Work in Chile," Economic Development and Cultural Change, University of Chicago Press, vol. 52(2), pages 347-368, January.
    9. Rawaa Harati, 2013. "Heterogeneity in the Egyptian informal labour market: choice or obligation?," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) halshs-00820783, HAL.
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    Cited by:

    1. Bohne, Albrecht & Nimczik, Jan Sebastian, 2018. "Information Frictions and Learning Dynamics: Evidence from Tax Avoidance in Ecuador," IZA Discussion Papers 11536, Institute for the Study of Labor (IZA).

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    Keywords

    : informality; poverty; developing economy;

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