Research
Research
Abstract: To finance increased public spending and social programs, Latin America's tax systems need to develop further. Yet taxation can reduce the tax base by discouraging formal employment. Evidence on the intensity of the problem is limited and tends to focus on specifically large reforms of the tax system. Conversely, and to improve external validity, we study whether routine changes in tax policies also alter labor market formalization. Our approach is based on grouped-data estimations of formal employment responses to policy changes. We exploit tax variation across three countries (Bolivia, Ecuador and Colombia) and three periods (2008, 2014/15, 2019). We use precise calculations of counterfactual tax burdens when moving from informal to formal jobs, i.e. formalization tax rates (FTRs). For most countries and pairs of years, FTRs have a negative and significant effect on formal employment, particularly when wages are held constant across periods – in order to extract the pure policy effect – and in a series of sensitivity checks.
Abstract: Latent feelings of economic vulnerability and social stagnation may have catalyzed the unprecedented uprisings that shook Latin America and other parts of the world in 2018-2019. We document this process in the context of Chile, leveraging survey data on protest participation and its potential determinants. Specifically, we construct a “social gap” index, measuring the disconnect between objective and perceived social status. Our findings suggest that this social gap predicts protest involvement beyond factors such as perceived living costs, the subjective value of public services, peer influence, or political demands. Notably, it complements broader feelings of anger toward inequalities in explaining protests.
Bargain, Jara and Rivera. (2025). How tax-benefit systems (mis)curbed inequality and poverty across Latin-American Countries, mimeo
Rivera D. (2025) The informalizing effect of minimum wages.
Rivera D., (2022) .The In's and Out's of Mexican Informal Employment,
Disentangling Investment and Heterogeneous Informal Employment
The link between Erradication Policies and Unexpected Crime in Colombia : An IV approach
Do taxes really redistribute wealth ? (05/2023)
There are more billionaires called Jeff than afro-american billionaires - and other inequalities (09/2023)
Inequalities: Well-being is also a matter of subjective placement (12/2023)
Do not fear! - the real economic consequences of migration (02/2024)
https://lacledesondes.fr/audio/les-cles-de-l-eco-2024-02-13m.mp3
The Paradox of rationality and game theory (04/2024)
https://lacledesondes.fr/audio/les-cles-de-l-eco-2024-04-02M.mp3