Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/115413
Authors: 
Espino, Emilio
Sanchez, Juan M.
Year of Publication: 
2013
Series/Report no.: 
IDB Working Paper Series IDB-WP-403
Abstract: 
Providing unemployment insurance is particularly problematic in countries with high informality because workers can claim unemployment benefits and work in the informal sector at the same time. This paper proposes a method to evaluate alternative schemes to provide insurance for unemployed individuals. First, it presents an economy that can be calibrated to reproduce key features of the economy for which the reform will be evaluated. Then, it shows how the implementation of an unemployment insurance savings account (UISA) scheme can be evaluated. The method is applied to Mexico, and the results show how the UISA scheme would eliminate incentives for participation in the informal sector. The implementation of the UISA would imply large welfare gains from the ex-ante perspective.
Subjects: 
Unemployment
insurance
Mexico
informality
JEL: 
D82
H55
I38
J65
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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