What Aspects of Formality Do Workers Value? Evidence from a Choice Experiment in Bangladesh

This study uses a choice experiment among 2,000 workers in Bangladesh to elicit willingness to pay (WTP) for job attributes: a contract, termination notice, working hours, paid leave, and a pension fund. Using a stated preference method allows calculation of WTP for benefits in this setting, despite the lack of data on worker transitions, and the fact that many workers are self-employed, which makes it difficult to use revealed preference methods. Workers highly value job stability: the average worker would be willing to forgo a 27 percent increase in income to obtain a one-year contract (relative to no contract), or to forgo a 12 percent increase to obtain thirty days of termination notice. There is substantial heterogeneity in WTP by type of employment and gender: women value shorter working hours more than men, while government workers place a higher value on contracts than do private-sector employees.

Bibliographic Details

Main Authors:	Mahmud, Minhaj, Gutierrez, Italo A., Kumar, Krishna B., Nataraj, Shanthi
Format:	Journal Article biblioteca
Language:	en_US
Published:	Published by Oxford University Press on behalf of the World Bank 2020-01-06
Subjects:	INFORMALITY, WORKING CONDITIONS, CHOICE EXPERIMENT,
Online Access:	https://openknowledge.worldbank.org/handle/10986/40777
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