Economics, Econometrics and Finance
4 years ago

Stricter labor regulation leads to lower wages and productivity for firms

1 view
World Bank policy research working paper
Enforcement Of Labor Regulation, Informal Labor, And Firm Performance
Rita Almeida, Pedro Carneiro

Paper Summary

This study looked at how enforcing labor laws affects firms using informal labor and their performance. When labor regulations are strictly enforced, firms tend to hire less informal workers. This leads to lower wages, productivity, and investment for the firms. The findings show that stricter enforcement of labor laws has a negative impact on firm performance.

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