Inequality, income dynamics, and transitions of Mexican workers

Arbeitspapier

We characterize the salient features of the distribution of earnings and earnings changes of formal workers in Mexico using social security records for the period 2005-2019. We find strong evidence of deviations from normality of these distributions. Comparing the results obtained with administrative data and household survey data suggests that this latter source of information is inadequate to fully capture the evolution of inequality and the properties of earnings changes. We also study the impact of transitions out of and back into formal employment on wages earned in the formal sector and the effect of early exposure to informality on future earnings. We document that workers who exit formal employment experience a significant wage penalty upon re-entry and that having the first job in the informal sector has a negative and significant impact on future earnings.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Working Papers ; No. 2022-14

Classification and Topics

• Classification: Wirtschaft ; Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity ; Human Capital; Skills; Occupational Choice; Labor Productivity ; Wage Level and Structure; Wage Differentials ; Informal Labor Markets
• Subject: Earnings dynamics ; higher-order earnings risk ; inequality ; worker transitions ; informal labor markets

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Puggioni, Daniela ; Calderón, Mariana ; Cebreros, Alfonso ; Fernández Bujanda, León ; Inguanzo, José A. ; Jaume, David
• Event: Veröffentlichung
• (who): Banco de México
• (where): Ciudad de México
• (when): 2022

Further information

• Handle: http://hdl.handle.net/10419/273670
• Last update: 10.03.2025, 11:43 AM CET