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Do Informal Workers Queue for Formal Jobs in Brazil?

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  • Fábio Veras Soares

Abstract

This paper investigates the existence of a job queue for formal (registered) jobs in the Brazilian labour market in an endogenous switching regression framework. This approach aims at correctly specifying the allocation process in the presence of queuing and getting unbiased wage equation estimates in order evaluate the role of wage differential between formal and informal sector in determining sector allocation. We estimate three types of bivariate probit specifications in order to evaluate the sensitivity of the results to different assumptions about the sector allocation process. In particular, we assess the sensitivity of the job queue estimates to the usual assumption of partial observability using subjective survey questions on the desire of informal (non-registered) workers to switch to formal job. Our tests were not able to reject the hypothesis of job queue. Our estimates of the job queue “length” for selected groups show that non-white, female, illiterate, “new entrants” and former informal workers are the groups with the lower probability of being chosen from the queue conditional on being in the queue. This result is particularly strong for workers whose last job was in the informal sector, suggesting that a spell in the informal sector may jeopardize the worker’s chance of getting a formal job. Este artigo investiga a existência de fila por trabalhos formais (com carteira) no mercado de trabalho brasileiro. Estima-se uma regressão com mudança endógena (endogenous switching regression) a fim de especificar corretamente o processo de alocação setorial dos trabalhadores na presença de filas, e desse modo, conseguir estimar o diferencial de salários entre trabalhadores do setor formal e do informal livre de viés de seletividade. Foram avaliados três diferentes especificações de probit bivariados com o intuito de avaliar a sensibilidade das estimativas das filas a diferentes hipóteses sobre o processo de alocação setorial. Em particular, testou-se a sensibilidade das estimativas das filas por trabalho à hipótese de observação parcial dos modelos de fila por trabalho usando perguntas subjetivas de pesquisas (Pnad 1990) sobre o desejo dos trabalhadores do setor informal de mudar para um emprego formal. Os testes não rejeitam a hipótese de existência de fila por trabalho formal. Entre os trabalhadores com maiores dificuldades de serem escolhidos da fila, uma vez que estejam nela, estão os negros, as mulheres, os analfabetos, os jovens que estão entrando no mercado de trabalho e os trabalhadores que foram informais no último trabalho. Este último resultado sugere que um período no setor informal reduz bastante a chance de um trabalhador conseguir um posto de trabalho formal no futuro.

Suggested Citation

  • Fábio Veras Soares, 2015. "Do Informal Workers Queue for Formal Jobs in Brazil?," Discussion Papers 0130, Instituto de Pesquisa Econômica Aplicada - IPEA.
    • Handle: RePEc:ipe:ipetds:0130
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    References listed on IDEAS

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    Cited by:

    1. Weller, Jürgen & Kaldewei, Cornelia, 2013. "Empleo, crecimiento sostenible e igualdad," Macroeconomía del Desarrollo 35881, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
    2. -, 2014. "Economic Survey of Latin America and the Caribbean 2014: Challenges to sustainable growth in a new external context," Estudio Económico de América Latina y el Caribe, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL), number 37033 edited by Eclac.
    3. Dante Contreras & Roberto Gillmore & Esteban Puentes, 2017. "Self‐Employment and Queues for Wage Work: Evidence from Chile," Journal of International Development, John Wiley & Sons, Ltd., vol. 29(4), pages 473-499, May.
    4. Luiz de Mello, 2011. "Brazil’s Achievements and Challenges," CESifo Forum, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 12(1), pages 3-10, March.
    5. -, 2014. "Estudio Económico de América Latina y el Caribe 2014: desafíos para la sostenibilidad del crecimiento en un nuevo contexto externo," Estudio Económico de América Latina y el Caribe, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL), number 36970 edited by Cepal.
    6. Luiz de Mello, 2009. "Brazil's Growth Performance: Achievements and Prospects," WIDER Working Paper Series RP2009-55, World Institute for Development Economic Research (UNU-WIDER).
    7. -, 2014. "Inestabilidad y desigualdad: La vulnerabilidad del crecimiento en América Latina y el Caribe," Libros de la CEPAL, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL), number 37042 edited by Cepal, May.
    8. Fábio Veras Soares, 2004. "Some Stylized Facts of The Informal Sector in Brazil in the 1980`s end 1990`s," Discussion Papers 1020, Instituto de Pesquisa Econômica Aplicada - IPEA.
    9. Larrain, Mauricio & Poblete, Joaquin, 2007. "Age-differentiated minimum wages in developing countries," Journal of Development Economics, Elsevier, vol. 84(2), pages 777-797, November.
    10. Mauricio Larraín & Joaquín Poblete, 2004. "Age-Differentiated Minimum Wages in a Dual Labor Market Model," Working Papers Central Bank of Chile 268, Central Bank of Chile.

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