Financial disincentives to formal employment in the Andean region

Holguer Xavier Jara Tamayo, Research Fellow at University of Essex and a member of the ECUAMOD national team, will give a presentation on Financial disincentives to formal employment in the Andean region in a webinar organized by the Bank of the Ecuadorian Social Security Institute (BIESS). The webinar will take place on 10 November 2020 at 11am (UTC -5). The event is in Spanish.

The objective of the event is to present results on the financial costs informal workers would incur in the event of entering formal employment in five countries of the Andean region: Bolivia, Colombia, Ecuador, Peru and Venezuela. The analysis is based on comparative tax-benefit microsimulation models for these countries (COLMOD, ECUAMOD, PERUMOD and LATINMOD).

The topic is of relevance for academics and policy makers in the country to understand the financial disincentives to enter formal employment implied by the tax-benefit system and to discuss potential pathways to reform social security contributions and personal income tax in the region.

ECUAMOD, one of the tax-benefit models used in the analysis and developed as part of the SOUTHMOD project, is an essential tool to assess the effects of tax-benefit policies on the income distribution, work incentives and labour supply of the country.