Defining and Measuring Informality: The Case of Turkish Labor Market

Year 2016, Volume: 24 Issue: 28, - , 14.04.2016

Elif Acar Aysıt Tansel

https://doi.org/10.17233/se.89776

Cited By: 5

Abstract

In this study, we consider how informality can be defined and measured in the Turkish labor market. The empirical analysis consists of developing three alternative definitions of labor informality, and exploring the relevance and implications of each for the Turkish labor market using descriptive statistics and multivariate probit analysis of the likelihood of informality under each definition. We find that social security registration criterion is a better measure of informality in the Turkish labor market given its ability to capture key relationships between several individual and employment characteristics and the likelihood of informality.

Keywords

-

References

• Aydın, E. & M. Hisarciklilar & İ. İlkkaracan (2010), “Formal versus Informal Labor Market Segmentation in Turkey in the course of Market Liberalization”, Topics in Middle Eastern and North African Economies, 12, 1-43.
• Bromley, R. (1978), “The urban informal sector: why is it worth discussing?”, World Development, 6 (9-10), 1033-1039.
• Bulutay, T. (2000), The Unrecorded Economy As Related to the Labour Market, Ankara: State Institute of Statistics.
• Bulutay, T. & E. Taştı (2004), “Informal Sector in the Turkish Labour Market”, TEA Working Papers, No. 2004/22, Turkish Economic Association, Ankara.
• Chen, M.A. (2007), “Rethinking the Informal Economy: Linkages with the Formal Economy and the Formal Regulatory Environment”, DESA Working Papers, No. 46, Department of Economic and Social Affairs, United Nations.
• De Soto, H. (1990), The Other Path: The Invisible Revolution in the Third World, New York: Harper Trade.
• Ercan, H. (2010), “The Impact of the Global Financial Crisis on Employment in Turkey”, In: Crisis and Turkey: Impact Analysis of Crisis Response Measures, Ankara: International Labour Organization Office For Turkey.
• Ercan, H. (2011), Occupational Outlook in Turkey, Ankara: International Labour Organization Office for Turkey.
• Harris, J.R. & M.P. Todaro (1970), “Migration, Unemployment and Development: A Two-Sector Analysis”, The American Economic Review, 60 (1), 126-142.
• Hart, K. (1973), “Informal Income Opportunities and Urban Employment in Ghana”, The Journal of Modern African Studies, 11 (1), 61-89.
• Henley, A. & G.R. Arabsheibani & F.G. Carneiro (2009), “On defining and measuring the informal sector: Evidence from Brazil”, World Development, 37 (5), 992-1003.
• Hussmanns, R. (2004), Defining and measuring informal employment, Geneva: International Labour Office.
• Hussmanns, R. (2005), “Measuring the informal economy: From employment in the informal sector to informal employment”, ILO Working paper, No. 53, International Labour Organization.
• Jütting, J. & J. Parlevliet & T. Xenogiani (2008), “Informal employment re-loaded”, OECD Development Centre Working Papers 266, Organisation for Economic Co-operation and Development (OECD).
• Kanbur, R. (2009), “Conceptualizing Informality: Regulation and Enforcement”, IZA Discussion Papers, No. 4186, Institute for the Study of Labor.
• Karaarslan, E. (2014), Türkiye de Kayıt Dışı İstiham, Antalya: BEKAD Yayınları.
• Kenar, N. (2009), “Informality: Regulations, Institutions and Enforcement”, Background paper for the World Bank Country Economic Memorandum- Informality: Causes, Consequences, Policies.
• Kuznets, S. (1955), “Economic Growth and Income Inequality”, American Economic Review, 45, 1-28.
• Lewis, W.A. (1954), “Economic Development with Unlimited Supplies of Labor”, Manchester School of Economic and Social Studies, 22, 139-191.
• Loayza, N. & L. Serven & N. Sugawara (2009), “Informality in Latin America and the Caribbean”, Policy Research Working Paper Series, No. 4888, Washington D.C.: The World Bank.
• Maloney, W. (2004), “Informality Revisited”, World Development, 32 (7), 1159-1178.
• OECD (2008), “Declaring Work or Staying Underground: Informal Employment in Seven OECD Countries”, OECD Employment Outlook, Paris: Organisation for Economic Co-operation and Development.
• OECD (2009), “IOPS Country Profiles: Turkey, Country Pension Design”, OECD Global Pension Statistics, Paris: Organisation for Economic Co-operation and Development.
• OECD (2010), OECD Economics Surveys: Turkey 2010, Paris: Organisation for Economic Co-operation and Development.
• Özdemir, A.M. & D. Erel & G. Yücesan-Özdemir (2004), “Rethinking Informal Labour Market in Turkey: A Possible Politics for Unions”, South East Europe Review, 7(2), 33-42.
• Perry, G. & W. Maloney & O. Arias & P. Fajnzylber & A. Mason & J. Saavedra (2007), Informality: Exit and Exclusion, World Bank Latin America and Caribbean Studies, Washington, D.C.: The World Bank.
• Saavedra, J. & A. Chong (1999), “Structural reform, institutions, and earnings: evidence from the formal and informal sectors in urban Peru”, The Journal of Development Studies, 35 (4), 95-116.
• State Planning Organization (2009), Action Plan of The Strategy For Fight Against Informal Economy, Ankara: State Planning Institute.
• Tansel, A. (1997), “Informal Sector Earnings Determination in Turkey”, ERF Regional Trade, Finance and Labor Markets in Transition Conference Proceedings, 153-161, Economic Research Forum.
• Tansel, A. (1999), “Formal versus Informal Sector Choice of Wage Earners and Their Wages in Turkey”, ERF Working Papers, No. 9927, Economic Research Forum.
• Tansel, A. (2001), “Wage Earners, Self Employed and Gender in the Informal Sector in Turkey”, ERF Working Papers, No. 0102, Economic Research Forum.
• Togan, S. (2001), “İşgücü Piyasasında Kayıtlı ve Kayıtdışı Sektörler”, in: T. Bulutay (Ed.), İşgücü Piyasası Açısından Kayıtdışı Ekonomi, Ankara: Turkish Statistical Institute.
• Toksöz, G. & S. Özşuca (2003), Sosyal Koruma Yoksunluğu: Enformel Sektör ve Küçük Isletmeler, Ankara: Ankara Üniversitesi SBF Yayınları.
• Tunalı, İ. (2000), “Basic Conceptual Problems in Analyses of the Informal Sector,” in: T. Bulutay (Ed.), Informal Sector I, Ankara: Turkish Statistical Instutite.
• Tunalı, İ. & H. Ercan (1998), “Labor Market Segmentation in Turkey”, in: T. Bulutay (Ed.), Main Characteristics and Trends of the Turkish Labour Market, 85-127, Ankara: Turkish Statistical Instutite.
• Turkish Statistical Institute (2011), Income and Living Conditions Survey Micro Data Set (2006-2009).
• Turkish Statistical Institute (2012), Press Release on the Household Labor Force Survey for January 2012.
• World Bank (2010), Turkey Country Economic Memorandum (CEM) on Informality: Causes, Consequences, Policies, Washington D.C.: The World Bank.
• Yereli, A.B. & O. Karadeniz (2004), Kayıtdışı İstihdam, Ankara: Odak Yayınevi.
• Yu, D. (2012), “Defining and measuring informal employment in South Africa: A review of recent approaches”, Development Southern Africa, 29 (1), 157-175.