1. Introduction -- 2. Market distortions and productivity growth -- 3. Trade reform and productivity growth -- 4. Labour market flexibility and productivity growth -- 5. Informal sector, subcontracting and productivity growth -- 6. Foreign competition, bargaining power and cost-price margin --...

Studies on formal-informal interactions in the labor markets of developing countries claim that economic reform increases the level of informal activity. Although the extent of such claims differs across countries, it is generally believed that reform is likely to depress informal wage by...