We analyze mobility in urban Mexico between three labor market states: working in the formal sector, working in the informal sector, and not working. We use a dynamic multinomial logit panel data model with random effects, explaining the labor market state of each individual during each time...

Historically, episodes of rapid growth are accompanied by significant structural change. In this paper we therefore aim to quantify the extent to which factor accumulation induces structural change and productivity growth in industrializing economies. To fix ideas we present an extension of...

Tracking individual workers across employers and industries after Brazil's trade liberalization in the 1990s shows that foreign import penetration and tariff reductions trigger worker displacements but that neither comparative-advantage industries nor exporters absorb displaced workers for...

An AIDS epidemic threatens Ethiopia with a long wave of premature adult mortality, and thus with an enduring setback to capital formation and economic growth. The authors develop a two-sector model with three overlapping generations and intersectorally mobile labor, in which young adults...

This paper examines the adjustment of developing country labor markets to macroeconomic shocks. It models as having two sectors: a formal salaried (tradable) sector that may or may not be affected by union or legislation induced wage rigidities, and an informal (nontradable) self-employment...

An industry is modeled in which entrepreneurs, who are heterogeneous in ability, may produce formally or informally. It is shown how the formal-informal mix depends on the distribution of ability, product demand and various parameter values. The industry equilibrium is compared to one in which...

This paper addresses the question of whether the Bolivian gas boom of the 1990s has bypassed large parts of the poor population, thereby leading to increasing inequalities in an already unequal society. Using a Computable General Equilibrium model that is sequentially linked to a microsimulation...

This paper analyzes the cyclical properties of worker flows in Brazil and Mexico, two important developing countries with large unregulated or informal" sectors. It generates three stylized facts that are critical to the accurate modeling of the sector and which suggest the need to rethink the...

This paper argues that a significant part of measured TFP differences across countries is attributable not to technological factors that affect the entire economy neutrally, but rather, to variations in the structural composition of economies. In particular, the allocation of scarce inputs...

This paper studies the consequences of certain widespread policies for the quality and sustainability of growth. These policies cause economic inefficiency, environmental destruction and increased poverty. The paper develops a political economy model to show why the existence of such policies is...