Transforming informal work and livelihoods in Costa Rica and Nicaragua
No Thumbnail Available
Author/Creator
Author/Creator ORCID
Date
2020-08
Department
Program
Citation of Original Publication
Alaniz, Enrique; Gindling, T.H.; Mata, Catherine; Rojas, Diego; Transforming informal work and livelihoods in Costa Rica and Nicaragua; WIDER Working Paper 2020/100; https://www.wider.unu.edu/sites/default/files/Publications/Working-paper/PDF/wp2020-100.pdf
Rights
This item is likely protected under Title 17 of the U.S. Copyright Law. Unless on a Creative Commons license, for uses protected by Copyright Law, contact the copyright holder or the author.
Subjects
Abstract
We divide workers into six work statuses: formal self-employed, upper-tier informal self-employed, lower-tier informal self-employed, formal wage-employed, upper-tier informal wage-employed, and lower-tier informal wage-employed. In both Costa Rica and Nicaragua, earnings are highest for formal work, next for upper-tier informal, and last for lower-tier informal. Mobility out of lower-tier informal work is higher than out of all other work statuses. While many lower-tier informal workers leave employment or transition into other informal statuses, most transitions are from lower-tier informal into upper-tier informal and formal work. Transitions from all types of informality into formality are more common in Costa Rica than in Nicaragua, partly due to the larger proportion of formal workers within Costa Rica (58 per cent vs 19 per cent). Regressions of transitions on worker characteristics suggest that policies of providing vocational training and formal education to informal workers can promote transitions into betterpaying work statuses.