Replication files for: Are informal self-employment and informal employment as employee behaviorally distinct labor force states?
Luca Flabbi and Mauricio M. Tejada, "Are informal self-employment and informal employment as employee behaviorally distinct labor force states?", Economics Letters, Volume 231, October 2023, 111278
The paper performs both a parametric and non-parametric analysis to address a fundamental question in the growing literature using search models to study labor market informality: Should informal self-employment and informal employment as an employee be considered two different labor market states? Both analyses strongly reject equality between the two states, cautioning against aggregating them in a common "informality state". The parametric model identifies that the variation in informal self-employment income and the short duration of informal employee jobs are the primary factors that contribute to the observed differences between these labor market states.
To replicate the results run bash run.sh in the terminal. Note that Julia 1.8 with instantiated environment is required.
All the results where generated using a MacBook Pro M2 with 16 GB of RAM and runing macOS 13.4.
Note: Bootstrapped results may sligtly differ from those in the paper because the use of parallel computing. Eventought a random seed was used, the order of the working processor in each iteration is still random.
All the results are stored in the /res/ folder. The naming convetion is as follows:
est_param_0.txt: Estimated parameters of the unrestricted model.est_param_r_0.tx: Estimated parameters of the restricted model.likfun_0.txt: Value of the loglikelihood function of the unrestricted model.likfun_r_0.txt: Value of the loglikelihood function of the restricted model.imp_values_0.txt: Implied parameters of the unrestricted model (hazard rates and offered wages stats).imp_values_r_0.txt: Implied parameters of the restricted model (hazard rates and offered wages stats).est_param_boot_0.txt: Estimated parameters of the unrestricted model in each iteration of the bootstrap.stderror_boot_0.txt: Bootstrapped standard errores of the estimated parameters of the unrestricted model.est_param_boot_r_0.txt: Estimated parameters of the restricted model in each iteration of the bootstrap.stderror_boot_r_0.txt: Bootstrapped standard errores of the estimated parameters of the restricted model.est_param_boot_b_0.txt: Estimated b parameter of the unrestricted model in each iteration of the bootstrap.stderror_boot_b_0.txt: Bootstrapped standard errores of the estimated b parameter of the unrestricted model.est_param_boot_b_r_0.txt: Estimated b parameter of the restricted model in each iteration of the bootstrap.stderror_boot_b_r_0.txt: Bootstrapped standard errores of the estimated b parameter of the restricted model.