Multidimensional perspective of poverty, and its relation with the informal labor market: an application to ecuadorian and turkish data

Armagan T. Aktuna Gunes and  Carla Canelas

Informality in the labor market has gained particular attention from policy makers and researchers in the last decades. The increasing size of the informal sector and the important heterogeneity in the activities encompassed on it, give us an idea of the possible implications that the non regulation of this market has in the economic performance of the countries and most importantly on the well-being of the informal workers. The estimations of the OECD reveals that over half of all jobs in non-agricultural sectors in developing and emerging economies can be considered informal.

In this paper, we study the links between time use, informal labor market, and poverty measures in two countries that strongly differ on their level of development, by means of a multidimensional poverty index, and a bivariate probit model to assess the changes in the joint probability of working in the informal sector while being considered poor.

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