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Is there an informal employment wage premium? Evidence from Tajikistan

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  • Staneva, Anita V
  • Arabsheibani, G. Reza

Abstract

This paper defines informal sector employment and decomposes the difference in earnings between formal and informal sector employees in Tajikistan for 2007. Using quantile regression decomposition technique proposed by JAE, 20:445-465, 2005and considering self-selection of individuals into different employment types, we find a significant informal employment wage premium across the whole earnings distribution. Taking advantage of RES, 90:290-299, 2008matching approach and considering the possibility of misleading results due to different observed characteristics of formal and informal workers, we still find a wage gap in favour of informal sector workers.

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  • Staneva, Anita V & Arabsheibani, G. Reza, 2014. "Is there an informal employment wage premium? Evidence from Tajikistan," LSE Research Online Documents on Economics 90508, London School of Economics and Political Science, LSE Library.
    • Handle: RePEc:ehl:lserod:90508
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    Cited by:

    1. Petr Huber & Ulugbek Rahimov, 2014. "Formal and Informal Sector Wage Differences in Transition Economies: Evidence from Tajikistan," MENDELU Working Papers in Business and Economics 2014-48, Mendel University in Brno, Faculty of Business and Economics.
    2. Aysit Tansel & Halil Ibrahim Keskin & Zeynel Abidin Ozdemir, 2015. "Is There an Informal Employment Wage Penalty in Egypt?," Working Papers 976, Economic Research Forum, revised Dec 2015.
    3. Jacek Liwiński, 2022. "Informal employment and wages in Poland," International Journal of Manpower, Emerald Group Publishing Limited, vol. 44(6), pages 1196-1220, January.
    4. Altay Mussurov & Dena Sholk & G. Reza Arabsheibani, 2019. "Informal employment in Kazakhstan: a blessing in disguise?," Eurasian Economic Review, Springer;Eurasia Business and Economics Society, vol. 9(2), pages 267-284, June.
    5. Duman, Anil, 2024. "The Diversity of Informal Employment: a survey of drivers, outcomes, and policies," OSF Preprints yg3t7, Center for Open Science.
    6. Duman, Anil & Duman, Alper, 2021. "The More the Gloomier: development of informal employment and its effect on wages in Turkey," GLO Discussion Paper Series 870, Global Labor Organization (GLO).
    7. El-hadj Bah & Josef C. Brada, 2014. "Labor Markets in the Transition Economies: An Overview," European Journal of Comparative Economics, Cattaneo University (LIUC), vol. 11(1), pages 3-53, June.
    8. Christine ABLAZA & Mark WESTERN & Wojtek TOMASZEWSKI, 2021. "Good jobs and bad jobs for Indonesia's informal workers," International Labour Review, International Labour Organization, vol. 160(1), pages 143-168, March.
    9. Gustavo A. García, 2017. "Labor Informality: Choice or Sign of Segmentation? A Quantile Regression Approach at the Regional Level for Colombia," Review of Development Economics, Wiley Blackwell, vol. 21(4), pages 985-1017, November.
    10. Nguyễn, Hữu Chí. & Nguyen-Huu, Thanh Tam. & Le, Thi-Thuy-Linh., 2016. "Non-standard forms of employment in some Asian countries : a study of wages and working conditions of temporary workers," ILO Working Papers 994901213402676, International Labour Organization.
    11. Vladimir Otrachshenko & Olga Popova & Nargiza Alimukhamedova, 2024. "Rainfall variability and labor allocation in Uzbekistan: the role of women’s empowerment," Post-Soviet Affairs, Taylor & Francis Journals, vol. 40(2), pages 119-138, March.
    12. Artjoms Ivlevs, 2016. "Remittances and informal work," International Journal of Manpower, Emerald Group Publishing Limited, vol. 37(7), pages 1172-1190, October.
    13. Aysit Tansel & Halil Ibrahim Keskin & Zeynel Abidin Ozdemir, 2020. "Is there an informal employment wage penalty in Egypt? Evidence from quantile regression on panel data," Empirical Economics, Springer, vol. 58(6), pages 2949-2979, June.
    14. Victoria Strokova & Mohamed Ihsan Ajwad, 2017. "Tajikistan Jobs Diagnostic," World Bank Publications - Reports 26029, The World Bank Group.
    15. Duman, Anil, 2020. "Pay Gaps and Mobility for Lower and Upper Tier Informal Sector Employees: an investigation of the Turkish labor market," GLO Discussion Paper Series 655, Global Labor Organization (GLO).
    16. Robertson, Raymond & Di, Hongyang & Brown, Drusilla & Dehejia, Rajeev, 2016. "Working Conditions, Work Outcomes, and Policy in Asian Developing Countries," ADB Economics Working Paper Series 497, Asian Development Bank.
    17. Altay Mussurov & G Arabsheibani, 2015. "Informal self-employment in Kazakhstan," IZA Journal of Labor & Development, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 4(1), pages 1-19, December.
    18. Kimberly Scharf & Oleksandr Talavera & Linh Vi, 2023. "Gender Differences in Returns to Beauty," Discussion Papers 23-08, Department of Economics, University of Birmingham.
    19. Mengistu Assefa Wendimu & Peter Gibbon, 2014. "Labour markets for irrigated agriculture in central Ethiopia: Wage premiums and segmentation," IFRO Working Paper 2014/06, University of Copenhagen, Department of Food and Resource Economics.
    20. Aysit Tansel & Halil Ibrahim Keskin & Zeynel Abidin Ozdemir, 2015. "Is There An Infırmal Employment Wage Penalty in Egypt?," ERC Working Papers 1508, ERC - Economic Research Center, Middle East Technical University, revised Sep 2015.

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    More about this item

    Keywords

    formal/informal employment; quantile regression decomposition; matching; endogeneity;
    All these keywords.

    JEL classification:

    • J50 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - General

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