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Desarro. soc. | eISSN 1900-7760 | ISSN 0120-3584

Inequality and Informality in Latin America: The Case of Brazil

No. 78 (2017-03-01)
  • Javier Alejo
  • Cecilia Parada
https://doi.org/10.13043/dys.78.4

Abstract

This paper studies the relationship between the evolution of inequality and labor informality in Brazil during the 2000s. Despite the main goal of this paper is to present new evidence on the relation between informality and inequality, this should be analyzed together with other related factors. To make this analysis, and to establish the contribution of each factor, a number of econometric decompositions were performed. We use decomposition exercises based on the combination of reweighting techniques with recentered influence function (RIF) models. Results suggest that the process of formalization contributed to reducing the concentration of income by increasing the income of persons who belong to the lowest vintiles.

Keywords: Brazil, informality, inequality, RIF decomposition

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