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The Impact of Bank Credit on Employment Formality: Evidence from Uruguay

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  • Néstor Gandelman
  • Alejandro Rasteletti

Abstract

This article examines the effect of bank credit on employment formalization in Uruguay. Using a difference-in-differences methodology the article finds that financial deepening decreases informality, especially in more financially dependent sectors. In addition, the effect is found to be greater among women and older workers. In the period under analysis the economy underwent a severe economic crisis and bank credit contracted sharply, but we find no evidence that the effect of bank credit on employment formality changed over time.

Suggested Citation

  • Néstor Gandelman & Alejandro Rasteletti, 2016. "The Impact of Bank Credit on Employment Formality: Evidence from Uruguay," Emerging Markets Finance and Trade, Taylor & Francis Journals, vol. 52(7), pages 1661-1678, July.
    • Handle: RePEc:mes:emfitr:v:52:y:2016:i:7:p:1661-1678
    DOI: 10.1080/1540496X.2015.1024084
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    Cited by:

    1. Miguel Lorca, 2021. "Effects of COVID‐19 early release of pension funds: The case of Chile," Journal of Risk & Insurance, The American Risk and Insurance Association, vol. 88(4), pages 903-936, December.
    2. Balde, Racky, 2021. "Financial development and small firms’ tax compliance in Sub-Saharan Africa," MERIT Working Papers 2021-041, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).

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