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1. Local Economic Development Through Export-Led Growth: The Chilean Case

Author:
Andrés César and Guillermo Falcone
Publication Date:
04-2024
Content Type:
Working Paper
Institution:
Center for Distributive, Labor and Social Studies (CEDLAS)
Abstract:
We study the causal impact of export growth on Chilean local economic development during 2000–2006 by exploiting spatial and temporal variations in local exposure stemming from the interaction of past differences in industry specialization across local labor markets and the evolution of tariffs cuts and exports across industries. We find that growing exports implied a significant reduction in labor informality and labor income gains in more exposed local markets, driven by job creation and wage growth in the formal sector. These effects concentrate on senior skilled workers. Exposed locations also exhibit a greater relative decline in the poverty rate.
Topic:
Poverty, Employment, Economic Growth, Tariffs, Exports, Economic Development, Labor Market, Wages, and Informality
Political Geography:
South America and Chile

2. Effects of Hiring Credits on the Argentine Labor Market

Author:
Octavio Bertín, Guillermo Cruces, Diego Chaves-González, Ignacio Lunghi, and Azul Menduiña
Publication Date:
12-2024
Content Type:
Working Paper
Institution:
Center for Distributive, Labor and Social Studies (CEDLAS)
Abstract:
This study assesses the impact of a hiring credit policy introduced in Argentina in 2014 on various labor outcomes of firms. The reform established differentiated labor cost reductions in the employers contributions to be paid for their new employees, according to the size that firms had at a date prior to the announcement of the policy. Using a differences-in-differences approach and employer-employee administrative data, we analyze the intervention’s effects. Our results show a significant 4.1 percentage point increase in employment growth rates for small firms compared to medium-sized ones, persisting for several years post-reform. This paper also explores the relationship between the intervention’s effects and sector labor informality; we find a significant 6.2 percentage point increase in employment growth rates for firms in high-informality sector, whereas no significant effect is found for firms in lowinformality sectors.
Topic:
Employment, Labor Market, Wages, and Hiring Credits
Political Geography:
Argentina and South America

3. Youth Employment in Tourism: A Multidimensional Approach of Job Quality in Latin America

Author:
Malena Dolcet, Natalia Porto, and Joaqu´ın Zarrilli
Publication Date:
08-2024
Content Type:
Working Paper
Institution:
Center for Distributive, Labor and Social Studies (CEDLAS)
Abstract:
Young people entering the labor markets face several and important challenges. These issues deepen due to rooted structural barriers such as informality or precarity, low-paid jobs, and low economic growth in regions like Latin America and sectors such as tourism (Abramo, 2022). Tourism has great potential to employ many of these young people because it provides opportunities for skilled and unskilled workers, it has low barriers to entry and flexible conditions, and it provides critical skills for their professional life. However, the youth population needs to reduce the gap between their available skills and experienced gained and the future requirements of labor markets to avoid being socially excluded. We apply the multidimensional poverty methodology developed by Alkire and Foster (2011) to build a Quality of Employment index (QoE) for young workers employed in the tourism industry in Latin America for the period 2015-2019. Focusing on two groups of young workers -super young for those aged 15 to 24 and young those aged 25 to 35- we consider several aspects of working conditions and discuss some differences in job quality across countries by gender and education considering different levels of deprivation in the index. The results suggest a high level of deprivation in the young workers, specially in the super young group. However, employment quality increased in both groups for all countries in the region during the period 2015-2019.
Topic:
Tourism, Employment, Youth, and Labor Market
Political Geography:
Latin America

4. Buffer or Bottleneck? Employment Exposure to Generative AI and the Digital Divide in Latin America

Author:
Paweł Gmyrek, Hernan Winkler, and Santiago Garganta
Publication Date:
11-2024
Content Type:
Working Paper
Institution:
Center for Distributive, Labor and Social Studies (CEDLAS)
Abstract:
Empirical evidence on the potential impacts of generative artificial intelligence (GenAI) is mostly focused on high-income countries. In contrast, little is known about the role of this technology on the future economic pathways of developing economies. This paper contributes to fill this gap by estimating the exposure of the Latin American labor market to GenAI. It provides detailed statistics of GenAI exposure between and within countries by leveraging a rich set of harmonized household and labor force surveys. To account for the slower pace of technology adoption in developing economies, it adjusts the measures of exposure to GenAI by using the likelihood of accessing digital technologies at work. This is then used to assess the extent to which the digital divide across and within countries will be a barrier to maximize the productivity gains among occupations that could otherwise be augmented by GenAI tools. The findings show that certain characteristics are consistently correlated with higher exposure. Specifically, urban-based jobs that require higher education, are situated in the formal sector, and are held by individuals with higher incomes are more likely to come into interaction with this technology. Moreover, there is a pronounced tilt toward younger workers facing greater exposure, including the risk of job automation, particularly in the finance, insurance, and public administration sectors. When adjusting for access to digital technologies, the findings show that the digital divide is a major barrier to realizing the positive effects of GenAI on jobs in the region. In particular, nearly half of the positions that could potentially benefit from augmentation are hampered by lack of use of digital technologies. This negative effect of the digital divide is more pronounced in poorer countries.
Topic:
Employment, Digital Economy, Artificial Intelligence, and Labor Market
Political Geography:
Latin America

5. Measuring Green Jobs: A New Database for Latin America and Other Regions

Author:
Hernan Winkler, Vincenzo Di Maro, Kelly Montoya, Sergio Olivieri, and Emmanuel Vazquez
Publication Date:
09-2024
Content Type:
Working Paper
Institution:
Center for Distributive, Labor and Social Studies (CEDLAS)
Abstract:
A growing body of literature investigates the labor market implications of scaling up “green” policies. Since most of this literature is focused on developed economies, little is known about the labor market consequences for developing countries. This paper contributes to filling this gap by providing new stylized facts on the prevalence of green occupations and sectors across countries at varying levels of economic development. Green occupations are defined using the Occupational Information Network, and green sectors are those with relatively lower greenhouse gas emissions per worker. The paper offers an initial assessment of how the implementation of green policies—aimed at expanding green sectors and strengthening the relative demand for green skills—may affect workers in developing economies. It finds that the share of green jobs is strongly correlated with the level of gross domestic product per capita across countries. When controlling for unobserved heterogeneity, a 1 percent increase in gross domestic product per capita is associated with 0.4 and 4.1 percentage point increases in the shares of new and emerging, and enhanced skills green jobs, respectively. The paper then focuses on Latin America and finds that only 9 percent of workers have a green job with respect to both occupation and sector. The findings show that within countries, workers with low levels of income and education are more likely to be employed in non-green sectors and occupations, and to lack the skills for a greener economy. This evidence suggests that complementary policies are needed to mitigate the potential role of green policiesin widening income inequality between and within countries.
Topic:
Climate Change, Employment, Labor Market, and Green Jobs
Political Geography:
Latin America

6. Do Minimum Wage Hikes Lead to Employment Destruction? Evidence from a Regression Discontinuity Design in Argentina

Author:
Nicolás Abbate and Carlos García Jiménez
Publication Date:
02-2023
Content Type:
Working Paper
Institution:
Center for Distributive, Labor and Social Studies (CEDLAS)
Abstract:
In this study, we examine the impact of eight minimum wage increases in Argentina during the early 21st century by analyzing administrative records of registered employment. Utilizing a regression discontinuity design, we compare job separation rates between a group affected by the minimum wage hikes and a control group slightly out of their legal scope. We show that this method improves upon previous methods by reducing the likelihood of Type-I error. Overall, we find that the minimum wage hikes had no significant effect on job separation rates. However, the increases implemented in 2008 resulted in a decrease of 4.8 percentage points (19%) in separations, indicating that the employment effects of minimum wages may not necessarily lead to job loss.
Topic:
Employment, Economy, and Minimum Wage
Political Geography:
South Asia and Argentina

7. Lucky Women in Unlucky Cohorts: Gender Differences in the Effects of Initial Labor Market Conditions in Latin America

Author:
Inés Berniell, Leonardo Gasparini, Mariana Marchionni, and Mariana Viollaz
Publication Date:
01-2022
Content Type:
Working Paper
Institution:
Center for Distributive, Labor and Social Studies (CEDLAS)
Abstract:
This paper assesses gender differences in the effects of adverse conditions at labormarket entry in a developing region. Using harmonized microdata from national household surveys for 15 Latin American countries, we build a synthetic panel of cohorts that potentially transition from school to work and observe their labor market outcomes 10 years later. We find that men who faced higher unemployment rates at ages 18-20 suffer a negative effect on employment at ages 27-30. In contrast, women from those same unlucky cohorts have higher employment rates and earnings. Our results are consistent with women acting as secondary workers in downturns. We also find that women from unlucky cohorts control a larger share of family income and are more likely to be the head of household 10 years after labor market entry, and that adverse initial labor market conditions are correlated to more egalitarian perceptions about gender roles later in life.
Topic:
Employment, Unemployment, Economic Crisis, Gender, and Scarring Effects
Political Geography:
Latin America

8. Costs and Benefits of Trade Shocks: Evidence from Chilean Local Labor Markets

Author:
Andres Cesar, Guillermo Falcone, and Leonardo Gasparini
Publication Date:
07-2022
Content Type:
Working Paper
Institution:
Center for Distributive, Labor and Social Studies (CEDLAS)
Abstract:
We study Chile’s labor market responses to trade shocks during 1996-2006, exploiting spatial and time variations in trade exposure arising from initial differences in industry specialization across local labor markets and the evolution of shocks across industries. We take advantage of China’s supply and demand’s worldwide shocks to instrument for Chinese import competition and demand for Chilean exports. Our main finding is that increasing manufacturing import competition implied a significant rise in labor informality in more exposed local markets, especially among young and unskilled workers. These groups also suffered significant relative wage losses. Meanwhile, locations that benefited most from the increased demand for primary products experienced a relative increase in employment, particularly among young individuals, and reallocation from self-employment towards salaried jobs in the formal sector, along with relative wage gains among old-age workers. Interestingly, these areas experienced a smaller increase in tertiary education enrollment rates than less exposed areas.
Topic:
Employment, Trade, Labor Market, and Informal Economy
Political Geography:
South America and Chile

9. The Risk of Automation in Latin America

Author:
Irene Brambilla, Andrés César, Guillermo Falcone, Leonardo Gasparini, and Carlo Lombardo
Publication Date:
06-2021
Content Type:
Working Paper
Institution:
Center for Distributive, Labor and Social Studies (CEDLAS)
Abstract:
In this paper we characterize workers’ vulnerability to automation in the near future in the six largest Latin American economies as a function of the exposure to routinization of the tasks that they perform and the potential automation of their occupation. We combine (i) indicators of potential automatability by occupation and (ii) worker’s information on occupation and other labor variables. We find that the ongoing process of automation is likely to significantly affect the structure of employment. In particular, unskilled and semi-skilled workers are likely to bear a disproportionate share of the adjustment costs. Automation will probably be a more dangerous threat for equality than for overall employment.
Topic:
Employment, Income Inequality, Economy, and Automation
Political Geography:
Latin America

10. Heterogeneous Effects of Forced Migration on Female Labor Supply

Author:
Julian Pedrazzi and Leonardo Penaloza
Publication Date:
01-2021
Content Type:
Working Paper
Institution:
Center for Distributive, Labor and Social Studies (CEDLAS)
Abstract:
In this paper we analyze the impact of Venezuelan migration on the female labor supply in Colombia. Using a instrumental variable approach we found significant drops in the female labor supply, mainly on those women with lower qualifications. In contrast, we observe significant increases for high-skilled women with family responsibilities, such as childcare. These results are consistent with a redistribution of time use, where women spend fewer hours on household tasks and more time in the labor market. Our results provide novel evidence of the consequences of forced migration between developing countries on the female labor supply.
Topic:
Gender Issues, Migration, Labor Issues, and Employment
Political Geography:
Colombia, South America, and Venezuela