Abstract

AGUILAR, José G.  and  MAHECHA GUERRA, Barceló Ronal E.. Informality, growth and development on the Colombian-Venezuelan border: the case of the department of Arauca. Cuad. Econ. [online]. 2022, vol.41, n.87, pp.699-722.  Epub Jan 24, 2023. ISSN 0121-4772.  https://doi.org/10.15446/cuad.econ.v41n87.92446.

It is usually assumed that labor informality reduces the tax base, threatens public spending and makes employment precarious. Using a fixed effects panel data model and the Moran index, we want to investigate the sensitivity of labor informality to the levels of regional economic growth and development, the geographic positioning, the border conditions and migration flows in the Colombian department of Arauca for the period 2011-2017. We found that the level of tax revenues and educational coverage have a good capacity to explain informality and, therefore, can be used strategically by municipalities authorities in the design of public policy. Although a positive global relationship between informality and economic growth is ruled out, there are dynamics by which informality could be associated with the development of some economic in a local scale. Additionally, there is evidence that informality in the Araucanian municipalities maintains relational patterns that change over time. Finally, even though the border condition has an impact on informality, the structural factors associated with this phenomenon seem to have an even greater one.

Keywords : Informality; economic growth; spatial correlation; department of Arauca; Colombian-Venezuelan border.

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