The anatomy of behavioral responses to social assistance when informal employment is high
- Autores
- Bergolo Sosa, Marcelo Luis; Cruces, Guillermo Antonio
- Año de publicación
- 2016
- Idioma
- inglés
- Tipo de recurso
- artículo
- Estado
- versión publicada
- Descripción
- The disincentive effects of social assistance programs on registered employment are a first order policy concern in developing countries. Means tests determine eligibility with respect to some income threshold, and governments can only verify earnings from registered employment. The loss of benefit at some level of formal earnings is an implicit tax that results in a strong disincentive for formal employment. We study an income-tested program in Uruguay and extend previous literature by developing an anatomy of the behavioral responses to this program. Our identification strategy is based on a sharp discontinuity in the program?s eligibility rule and uses information from the program?s records, social security administration data, and a follow-up survey. First, we establish that beneficiaries respond to the program?s incentives by reducing their levels of registered employment by about 8 percentage points. Second, we find the program induces a larger reduction of formal employment for individuals with a medium probability to be a registered employee, suggesting some form of segmentation ? those with a low propensity to work formally do not respond to the financial incentives of the program. Third, we find evidence that the fall in registered employment is due to a larger extent to an increase in unregistered employment, and to a lesser extent to a shift towards non employment. Fourth, we find an elasticity of participation in registered employment of about 1.7, implying a deadweight loss from the behavioral responses to the program of about 3.2% of total registered labor income.
Fil: Bergolo Sosa, Marcelo Luis. Universidad Nacional de La Plata. Facultad de Ciencias Económicas. Departamento de Ciencias Económicas. Centro de Estudios Distributivos Laborales y Sociales; Argentina
Fil: Cruces, Guillermo Antonio. Universidad Nacional de La Plata. Facultad de Ciencias Económicas. Departamento de Ciencias Económicas. Centro de Estudios Distributivos Laborales y Sociales; Argentina - Materia
-
welfare policy
labor supply
registered employment
labor informality - Nivel de accesibilidad
- acceso abierto
- Condiciones de uso
- https://creativecommons.org/licenses/by-nc-sa/2.5/ar/
- Repositorio
- Institución
- Consejo Nacional de Investigaciones Científicas y Técnicas
- OAI Identificador
- oai:ri.conicet.gov.ar:11336/101379
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spelling |
The anatomy of behavioral responses to social assistance when informal employment is highBergolo Sosa, Marcelo LuisCruces, Guillermo Antoniowelfare policylabor supplyregistered employmentlabor informalityhttps://purl.org/becyt/ford/5.2https://purl.org/becyt/ford/5The disincentive effects of social assistance programs on registered employment are a first order policy concern in developing countries. Means tests determine eligibility with respect to some income threshold, and governments can only verify earnings from registered employment. The loss of benefit at some level of formal earnings is an implicit tax that results in a strong disincentive for formal employment. We study an income-tested program in Uruguay and extend previous literature by developing an anatomy of the behavioral responses to this program. Our identification strategy is based on a sharp discontinuity in the program?s eligibility rule and uses information from the program?s records, social security administration data, and a follow-up survey. First, we establish that beneficiaries respond to the program?s incentives by reducing their levels of registered employment by about 8 percentage points. Second, we find the program induces a larger reduction of formal employment for individuals with a medium probability to be a registered employee, suggesting some form of segmentation ? those with a low propensity to work formally do not respond to the financial incentives of the program. Third, we find evidence that the fall in registered employment is due to a larger extent to an increase in unregistered employment, and to a lesser extent to a shift towards non employment. Fourth, we find an elasticity of participation in registered employment of about 1.7, implying a deadweight loss from the behavioral responses to the program of about 3.2% of total registered labor income.Fil: Bergolo Sosa, Marcelo Luis. Universidad Nacional de La Plata. Facultad de Ciencias Económicas. Departamento de Ciencias Económicas. Centro de Estudios Distributivos Laborales y Sociales; ArgentinaFil: Cruces, Guillermo Antonio. Universidad Nacional de La Plata. Facultad de Ciencias Económicas. Departamento de Ciencias Económicas. Centro de Estudios Distributivos Laborales y Sociales; ArgentinaIZA - Institute of Labor Economics2016-09info:eu-repo/semantics/articleinfo:eu-repo/semantics/publishedVersionhttp://purl.org/coar/resource_type/c_6501info:ar-repo/semantics/articuloapplication/pdfapplication/pdfapplication/pdfhttp://hdl.handle.net/11336/101379Bergolo Sosa, Marcelo Luis; Cruces, Guillermo Antonio; The anatomy of behavioral responses to social assistance when informal employment is high; IZA - Institute of Labor Economics; IZA Working Papers; 10197; 9-2016; 1-862365-9793CONICET DigitalCONICETenginfo:eu-repo/semantics/altIdentifier/url/https://www.iza.org/publications/dp/10197/the-anatomy-of-behavioral-responses-to-social-assistance-when-informal-employment-is-highinfo:eu-repo/semantics/openAccesshttps://creativecommons.org/licenses/by-nc-sa/2.5/ar/reponame:CONICET Digital (CONICET)instname:Consejo Nacional de Investigaciones Científicas y Técnicas2025-09-29T09:55:00Zoai:ri.conicet.gov.ar:11336/101379instacron:CONICETInstitucionalhttp://ri.conicet.gov.ar/Organismo científico-tecnológicoNo correspondehttp://ri.conicet.gov.ar/oai/requestdasensio@conicet.gov.ar; lcarlino@conicet.gov.arArgentinaNo correspondeNo correspondeNo correspondeopendoar:34982025-09-29 09:55:00.9CONICET Digital (CONICET) - Consejo Nacional de Investigaciones Científicas y Técnicasfalse |
dc.title.none.fl_str_mv |
The anatomy of behavioral responses to social assistance when informal employment is high |
title |
The anatomy of behavioral responses to social assistance when informal employment is high |
spellingShingle |
The anatomy of behavioral responses to social assistance when informal employment is high Bergolo Sosa, Marcelo Luis welfare policy labor supply registered employment labor informality |
title_short |
The anatomy of behavioral responses to social assistance when informal employment is high |
title_full |
The anatomy of behavioral responses to social assistance when informal employment is high |
title_fullStr |
The anatomy of behavioral responses to social assistance when informal employment is high |
title_full_unstemmed |
The anatomy of behavioral responses to social assistance when informal employment is high |
title_sort |
The anatomy of behavioral responses to social assistance when informal employment is high |
dc.creator.none.fl_str_mv |
Bergolo Sosa, Marcelo Luis Cruces, Guillermo Antonio |
author |
Bergolo Sosa, Marcelo Luis |
author_facet |
Bergolo Sosa, Marcelo Luis Cruces, Guillermo Antonio |
author_role |
author |
author2 |
Cruces, Guillermo Antonio |
author2_role |
author |
dc.subject.none.fl_str_mv |
welfare policy labor supply registered employment labor informality |
topic |
welfare policy labor supply registered employment labor informality |
purl_subject.fl_str_mv |
https://purl.org/becyt/ford/5.2 https://purl.org/becyt/ford/5 |
dc.description.none.fl_txt_mv |
The disincentive effects of social assistance programs on registered employment are a first order policy concern in developing countries. Means tests determine eligibility with respect to some income threshold, and governments can only verify earnings from registered employment. The loss of benefit at some level of formal earnings is an implicit tax that results in a strong disincentive for formal employment. We study an income-tested program in Uruguay and extend previous literature by developing an anatomy of the behavioral responses to this program. Our identification strategy is based on a sharp discontinuity in the program?s eligibility rule and uses information from the program?s records, social security administration data, and a follow-up survey. First, we establish that beneficiaries respond to the program?s incentives by reducing their levels of registered employment by about 8 percentage points. Second, we find the program induces a larger reduction of formal employment for individuals with a medium probability to be a registered employee, suggesting some form of segmentation ? those with a low propensity to work formally do not respond to the financial incentives of the program. Third, we find evidence that the fall in registered employment is due to a larger extent to an increase in unregistered employment, and to a lesser extent to a shift towards non employment. Fourth, we find an elasticity of participation in registered employment of about 1.7, implying a deadweight loss from the behavioral responses to the program of about 3.2% of total registered labor income. Fil: Bergolo Sosa, Marcelo Luis. Universidad Nacional de La Plata. Facultad de Ciencias Económicas. Departamento de Ciencias Económicas. Centro de Estudios Distributivos Laborales y Sociales; Argentina Fil: Cruces, Guillermo Antonio. Universidad Nacional de La Plata. Facultad de Ciencias Económicas. Departamento de Ciencias Económicas. Centro de Estudios Distributivos Laborales y Sociales; Argentina |
description |
The disincentive effects of social assistance programs on registered employment are a first order policy concern in developing countries. Means tests determine eligibility with respect to some income threshold, and governments can only verify earnings from registered employment. The loss of benefit at some level of formal earnings is an implicit tax that results in a strong disincentive for formal employment. We study an income-tested program in Uruguay and extend previous literature by developing an anatomy of the behavioral responses to this program. Our identification strategy is based on a sharp discontinuity in the program?s eligibility rule and uses information from the program?s records, social security administration data, and a follow-up survey. First, we establish that beneficiaries respond to the program?s incentives by reducing their levels of registered employment by about 8 percentage points. Second, we find the program induces a larger reduction of formal employment for individuals with a medium probability to be a registered employee, suggesting some form of segmentation ? those with a low propensity to work formally do not respond to the financial incentives of the program. Third, we find evidence that the fall in registered employment is due to a larger extent to an increase in unregistered employment, and to a lesser extent to a shift towards non employment. Fourth, we find an elasticity of participation in registered employment of about 1.7, implying a deadweight loss from the behavioral responses to the program of about 3.2% of total registered labor income. |
publishDate |
2016 |
dc.date.none.fl_str_mv |
2016-09 |
dc.type.none.fl_str_mv |
info:eu-repo/semantics/article info:eu-repo/semantics/publishedVersion http://purl.org/coar/resource_type/c_6501 info:ar-repo/semantics/articulo |
format |
article |
status_str |
publishedVersion |
dc.identifier.none.fl_str_mv |
http://hdl.handle.net/11336/101379 Bergolo Sosa, Marcelo Luis; Cruces, Guillermo Antonio; The anatomy of behavioral responses to social assistance when informal employment is high; IZA - Institute of Labor Economics; IZA Working Papers; 10197; 9-2016; 1-86 2365-9793 CONICET Digital CONICET |
url |
http://hdl.handle.net/11336/101379 |
identifier_str_mv |
Bergolo Sosa, Marcelo Luis; Cruces, Guillermo Antonio; The anatomy of behavioral responses to social assistance when informal employment is high; IZA - Institute of Labor Economics; IZA Working Papers; 10197; 9-2016; 1-86 2365-9793 CONICET Digital CONICET |
dc.language.none.fl_str_mv |
eng |
language |
eng |
dc.relation.none.fl_str_mv |
info:eu-repo/semantics/altIdentifier/url/https://www.iza.org/publications/dp/10197/the-anatomy-of-behavioral-responses-to-social-assistance-when-informal-employment-is-high |
dc.rights.none.fl_str_mv |
info:eu-repo/semantics/openAccess https://creativecommons.org/licenses/by-nc-sa/2.5/ar/ |
eu_rights_str_mv |
openAccess |
rights_invalid_str_mv |
https://creativecommons.org/licenses/by-nc-sa/2.5/ar/ |
dc.format.none.fl_str_mv |
application/pdf application/pdf application/pdf |
dc.publisher.none.fl_str_mv |
IZA - Institute of Labor Economics |
publisher.none.fl_str_mv |
IZA - Institute of Labor Economics |
dc.source.none.fl_str_mv |
reponame:CONICET Digital (CONICET) instname:Consejo Nacional de Investigaciones Científicas y Técnicas |
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CONICET Digital (CONICET) |
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CONICET Digital (CONICET) |
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Consejo Nacional de Investigaciones Científicas y Técnicas |
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CONICET Digital (CONICET) - Consejo Nacional de Investigaciones Científicas y Técnicas |
repository.mail.fl_str_mv |
dasensio@conicet.gov.ar; lcarlino@conicet.gov.ar |
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13.070432 |