The Anatomy of Behavioral Responses to Social Assistance When Informal Employment is High
- Autores
- Bérgolo Sosa, Marcelo; 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.
Centro de Estudios Distributivos, Laborales y Sociales - Materia
-
Ciencias Económicas
Welfare policy
Labor supply
Registered employment
Labor informality - Nivel de accesibilidad
- acceso abierto
- Condiciones de uso
- http://creativecommons.org/licenses/by-nc-sa/4.0/
- Repositorio
- Institución
- Universidad Nacional de La Plata
- OAI Identificador
- oai:sedici.unlp.edu.ar:10915/124355
Ver los metadatos del registro completo
id |
SEDICI_ffe87217ef869dac09eab43c657083ed |
---|---|
oai_identifier_str |
oai:sedici.unlp.edu.ar:10915/124355 |
network_acronym_str |
SEDICI |
repository_id_str |
1329 |
network_name_str |
SEDICI (UNLP) |
spelling |
The Anatomy of Behavioral Responses to Social Assistance When Informal Employment is HighBérgolo Sosa, MarceloCruces, Guillermo AntonioCiencias EconómicasWelfare policyLabor supplyRegistered employmentLabor informalityThe 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.Centro de Estudios Distributivos, Laborales y Sociales2016info:eu-repo/semantics/articleinfo:eu-repo/semantics/publishedVersionArticulohttp://purl.org/coar/resource_type/c_6501info:ar-repo/semantics/articuloapplication/pdfhttp://sedici.unlp.edu.ar/handle/10915/124355enginfo:eu-repo/semantics/altIdentifier/issn/1556-5068info:eu-repo/semantics/altIdentifier/doi/10.2139/ssrn.3229548info:eu-repo/semantics/reference/hdl/10915/65284info:eu-repo/semantics/openAccesshttp://creativecommons.org/licenses/by-nc-sa/4.0/Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International (CC BY-NC-SA 4.0)reponame:SEDICI (UNLP)instname:Universidad Nacional de La Platainstacron:UNLP2025-09-29T11:29:54Zoai:sedici.unlp.edu.ar:10915/124355Institucionalhttp://sedici.unlp.edu.ar/Universidad públicaNo correspondehttp://sedici.unlp.edu.ar/oai/snrdalira@sedici.unlp.edu.arArgentinaNo correspondeNo correspondeNo correspondeopendoar:13292025-09-29 11:29:54.406SEDICI (UNLP) - Universidad Nacional de La Platafalse |
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 Bérgolo Sosa, Marcelo Ciencias Económicas 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 |
Bérgolo Sosa, Marcelo Cruces, Guillermo Antonio |
author |
Bérgolo Sosa, Marcelo |
author_facet |
Bérgolo Sosa, Marcelo Cruces, Guillermo Antonio |
author_role |
author |
author2 |
Cruces, Guillermo Antonio |
author2_role |
author |
dc.subject.none.fl_str_mv |
Ciencias Económicas Welfare policy Labor supply Registered employment Labor informality |
topic |
Ciencias Económicas Welfare policy Labor supply Registered employment Labor informality |
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. Centro de Estudios Distributivos, Laborales y Sociales |
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 |
dc.type.none.fl_str_mv |
info:eu-repo/semantics/article info:eu-repo/semantics/publishedVersion Articulo 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://sedici.unlp.edu.ar/handle/10915/124355 |
url |
http://sedici.unlp.edu.ar/handle/10915/124355 |
dc.language.none.fl_str_mv |
eng |
language |
eng |
dc.relation.none.fl_str_mv |
info:eu-repo/semantics/altIdentifier/issn/1556-5068 info:eu-repo/semantics/altIdentifier/doi/10.2139/ssrn.3229548 info:eu-repo/semantics/reference/hdl/10915/65284 |
dc.rights.none.fl_str_mv |
info:eu-repo/semantics/openAccess http://creativecommons.org/licenses/by-nc-sa/4.0/ Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International (CC BY-NC-SA 4.0) |
eu_rights_str_mv |
openAccess |
rights_invalid_str_mv |
http://creativecommons.org/licenses/by-nc-sa/4.0/ Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International (CC BY-NC-SA 4.0) |
dc.format.none.fl_str_mv |
application/pdf |
dc.source.none.fl_str_mv |
reponame:SEDICI (UNLP) instname:Universidad Nacional de La Plata instacron:UNLP |
reponame_str |
SEDICI (UNLP) |
collection |
SEDICI (UNLP) |
instname_str |
Universidad Nacional de La Plata |
instacron_str |
UNLP |
institution |
UNLP |
repository.name.fl_str_mv |
SEDICI (UNLP) - Universidad Nacional de La Plata |
repository.mail.fl_str_mv |
alira@sedici.unlp.edu.ar |
_version_ |
1844616178068094976 |
score |
13.070432 |