Analysis of formal-informal transitions in the Ecuadorian labour market

Vega Núñez, Adriana Patricia

2017-12

4
LC/PUB.2017/24-P

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The study analyses the transitions between the formal and informal labour markets using longitudinal data for Ecuador. First, we use transition matrices to characterize the short-run dynamics among the different labour statuses in Ecuador. Next, multinomial logit models are used to identify the factors that determine the probability of remaining in or moving across the formal and informal sectors. Education level, years of experience and wage differentials by sector have a significant effect on worker transitions, showing that benefits and costs vary depending on the individual’s preferences and skills.

EMPLOYMENT STATISTICS; LABOUR MOBILITY; MATHEMATICAL ANALYSIS; LABOUR MARKET; INFORMAL SECTOR; EMPLOYMENT; EMPLEO; MERCADO DE TRABAJO; SECTOR INFORMAL; MOVILIDAD DE LA MANO DE OBRA; ANALISIS MATEMATICO; ESTADISTICAS DEL EMPLEO;