Social exclusion and the informal sector: the case of Russia
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This paper examines the relationship between labour market and social exclusion in Russia using the Russian Longitudinal Monitoring Survey (1994-2003). In particular we study if working in the informal sector protects individual from persistent poverty or social exclusion. We define the exclusion as being or feeling poor for a relatively long time period. First of all, we run the ordered probit model for the number of times an individual is found being or feeling poor in the survey. Then, to take into account the endogenous nature of working in the informal sector and social exclusion, we provide a ML estimation of two simultaneous equations: ordered probit for social exclusion and (ordered) probit for individual labour market status. The results show that the probability of being excluded is greater for individuals working in informal sector and these findings are robust for all econometric specifications. We interpret this result like evidence that survival plays an important role in the decision of working in the informal sector in Russia.
JOUR
Beuran, Monica
Kalugina, Ekaterina
2006
Centre d’Economie de la Sorbonne, Université de Paris Working Paper
754
