Abstract

VARELA LLAMAS, Rogelio  and  RETAMOZA YOCUPICIO, Ricardo Rodolfo. Labor informality, economic growth and public spending in Mexico, 2005-2019. Ens. Rev. econ. [online]. 2023, vol.42, n.1, pp.57-82.  Epub May 19, 2023. ISSN 2448-8402.  https://doi.org/10.29105/ensayos42.1-3.

Labor informality has become a recurring theme in the literature on labor markets, especially due to its persistence in developing countries. In the case of Mexico, in recent years its discussion has become relevant from various analytical perspectives. To answer the question of what factors, explain the phenomenon under study, Autoregressive Models of Distributed Lags (ARDL) are estimated, where labor informality is the variable of interest. Time series data are used for the period 2005-2019 in quarterly frequency. The estimation results indicate that in the long term, real per capita economic growth and secondary and higher education contribute to reducing informality. It is also found that the action of the government through public spending per capita, allows to mitigate informality. The results support the idea that it is a complex and multifactorial phenomenon.

Keywords : labor informality; economic growth; public expenditure; cointegration; E26; O4; H5; C4.

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