IMF published this video item, entitled “Effectiveness of Containment Policies and Labor Market Adjustment in Latin America” – below is their description.
Labor markets in Latin America and the Caribbean (LAC) are characterized by high levels of informality. The presentation will discuss recent empirical work that explores how this feature affects the region’s ability to contain the Covid-19 outbreak through non-pharmaceutical interventions, and how it has shaped labor market adjustments. Local projection estimations show that countries where informality is commonplace experience smaller declines in cases after making containment more stringent. This appears to be linked to smaller reductions in mobility in high informality countries after the implementation of containment measures, which facilitates the spread of the disease. In addition, informal employment, which typically acts as buffer for cyclical fluctuations in activity, has fallen more steeply compared to formal employment during Covid. These findings highlight the difficult trade-offs facing Latin American policy makers as they tackle the health and economic impact of the pandemic.
IMF YouTube Channel
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