The NAIRU and informality in the Mexican labor market

Arbeitspapier

The non-accelerating inflation rate of unemployment (NAIRU) is not directly observable and the presence of informal workers imposes an additional challenge in its estimation. Countries with large informal sectors, traditional measures might not depict labor slack properly, as it has the wage flexibility needed to incorporate formal workers that cannot find a formal job. In this paper, we present an estimation of the traditional NAIRU for Mexico and an alternative measure that includes informality as an indicator of labor underutilization. We find that both measures of NAIRU and the associated labor market slack indicators follow similar patterns over time. However, the slack estimated with the indicator that includes informality seems to predict inflationary pressures more accurately when the unemployment gap is close to zero.

Angaben zum Objekt

• Sprache: Englisch

Verweise und Beziehungen

• Erschienen in: Series: Working Papers ; No. 2020-09

Klassifikation und Themen

• Klassifikation: Wirtschaft ; Informal Economy; Underground Economy ; Business Fluctuations; Cycles ; Monetary Policy
• Thema: Unemployment ; Informality ; NAIRU ; Business cycle

Beteiligte, Orts- und Zeitangaben

• Ereignis: Geistige Schöpfung
• (wer): Aguilar-Argaez, Ana María ; Alcaraz, Carlo ; Ramírez, Claudia ; Rodríguez-Pérez, Cid Alonso
• Ereignis: Veröffentlichung
• (wer): Banco de México
• (wo): Ciudad de México
• (wann): 2020

Weitere Informationen

• Handle: http://hdl.handle.net/10419/240698
• Letzte Aktualisierung: 10.03.2025, 11:43 MEZ