Understanding the Determinants of Economic Informality in Paraguay

For several years, the government of Paraguay has sought to address the issue of informality, both as a response to poverty reduction and a means to expand its tax base. While effort has been undertaken to describe informality, the government lacks the capacity and perhaps the will to analyze the phenomenon through a robust empirical lens. Hence, little is known about the informal economy beyond anecdotes, personal interactions, and description. This book is the first to comprehensively, rigorously, and empirically study the determinants of informality in Paraguay. This book is of vital interest to those studying the Paraguayan economy, development economics, Latin American economics, and informality.

Specifies an econometric model in an effort to uncover the causal determinants of the likelihood of participation in the informal labor market or in informal economic activities Provides a better understanding of the determinants of informality to assist public policy Provides insight into the study of extreme informality in other countries and contexts

Autorentext
Michael J. Pisani is Professor of International Business at Central Michigan University (CMU), USA. Dr. Pisani has taught collegiately for 28 years at ten institutions and has been a full-time member of the CMU faculty since 2002. During 2019, Dr. Pisani is a US Fulbright Scholar in Paraguay. Dr. Pisani has (co-)authored more than 100 journal articles, reports, and book chapters. He is also the author or co-author of three books on South Texas, two of which are focused on the informal and underground economy of the Texas-Mexico (or South Texas) borderlands, including Consumption, Informal Markets, and the Underground Economy: Hispanic Consumption in South Texas (Palgrave Macmillan, 2013). Fernando G. Ovando Rivarola is a researcher and active member of the research group in the Centro de Análisis y Difusión de la Economía Paraguaya (CADEP), Paraguay. He is an economist from the Universidad Nacional de Asunción (UNA) and earned a master's degree in Economics at the Universidad Nacional de La Plata (UNLP)Argentina. Mr. Ovando has written articles and working papers on the labor market and unemployment in Paraguay. His research interests include the labor market, income distribution, impact evaluation of public policies, fiscal policy, and public finances.

Inhalt

1. Introduction: Informality in Paraguayan Context.- 2. Literature Review: The Informal Economy.- 3. Informality Measure and Models.- 4. Logistic Regression Results of In/Formality in Paraguay.- 5. Discussion of Results.- 6. Policy Recommendations and Conclusions.