Abstract

ARRIETA-ARRIETA, Alí Miguel  and  MARRUGO-ARNEDO, Carlos Alberto. Determinants of the transition between the formal and informal sectors in Mexico, 2010 and 2017. rev. econ. Caribe [online]. 2020, n.26, pp.48-65.  Epub June 09, 2021. ISSN 2011-2106.

In the Mexican labor market, the transition from the informal to the formal sector and inversely depends on many factors at the individual level and the socioeconomic context of the country. The main objective of this research is to identify the sociodemographic factors that influence an individual's transition from the informal to the formal sector and vice versa in Mexico. Information from the Retrospective Demographic Survey (EDER) of 2017 was used. A logistic regression was estimated to identify the odds ratios of the different factors that determine the job transition. The main results indicate that, the more favorable the sociodemographic and socioeconomic characteristics of an individual, such as late age of entry into the labor market, higher educational level, less work experience and less number of unemployed throughout their life, belong to a high socioeconomic stratum, residing in an urban location and working in a productive unit with a high number of workers, the greater the propensity for a person to move from informality to formality. However, not all of these arrangements turned out to have an effect when transitioning from formality to informality, the latter scenario being mainly influenced by age at first job, being single, higher education, little work experience and belonging to a productive unit with greater number of workers. These factors being the main determinants for an individual not to transition from formality to informality.

Keywords : informality; formality; transition; Mexico.

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