Labor

Is Micro Too Small? Microcredit vs. SME Finance

Is Micro Too Small? Microcredit vs. SME Finance
World Development 43: 288-297. 2013.

Bauchet, Jonathan and Jonathan Morduch
12/15/2013

Microcredit and SME finance are often pitched as alternative strategies to create employment opportunities in low-income communities. So far, though, little is known about how employment patterns compare. We integrate evidence from three surveys to show that, compared to Bangladeshi microcredit customers, typical SME employees in Bangladesh have more education and professional skills, and live in households that are notably less poor. SME jobs also require long work weeks, clashing with family responsibilities. The evidence from Bangladesh rejects the idea that SME finance more efficiently creates jobs for the population currently served by microcredit.

Learning by working in big cities.

Learning by working in big cities.
Discussion Paper 9243, Centre for Economic Policy Research

De la Roca, Jorge and Diego Puga.
10/07/2013

Individual earnings are higher in bigger cities. We consider three reasons: spatial sorting of initially more productive workers, static advantages associated with workers' current location, and learning by working in big cities. Using rich administrative data for Spain, we find that workers in bigger cities do not have higher unobserved initial ability, as reflected in individual fixed-effects. Instead, they obtain an immediate static premium while working in bigger cities and also accumulate more valuable experience, which increases their earnings faster. The additional value of experience accumulated in bigger cities persists even after workers move away and is even stronger for those with higher unobserved initial ability. This combination of effects explains both the higher mean and the greater dispersion of earnings in bigger cities.

Parallel paths to enforcement: Private compliance, public regulation, and labor standards in the Brazilian sugar sector

Parallel paths to enforcement: Private compliance, public regulation, and labor standards in the Brazilian sugar sector
Politics & Society

Coslovsky, Salo and Richard Locke
09/16/2013

In recent years, global corporations and national governments have been enacting a growing number of codes of conduct and public regulations to combat dangerous and degrading work conditions in global supply chains. At the receiving end of this activity, local producers must contend with multiple regulatory regimes, but it is unclear how these regimes interact and what results, if any, they produce. This paper examines this dynamic in the sugar sector in Brazil. It finds that although private and public agents rarely communicate, let alone coordinate with one another they nevertheless reinforce each other’s actions. Public regulators use their legal powers to outlaw extreme forms of outsourcing. Private auditors use the trust they command as company insiders to instigate a process of workplace transformation that facilitates compliance. Together, their parallel actions block the low road and guide targeted firms to a higher road in which improved labor standards are not only possible but even desirable.

Economic development without pre-requisites: How Bolivian firms met food safety standards and dominated the global brazil-nut market

Economic development without pre-requisites: How Bolivian firms met food safety standards and dominated the global brazil-nut market
World Development

Coslovsky, Salo
09/16/2013

Brazilian firms used to dominate the brazil nut (BN) market to such an extent that the product still carries the country’s name. Presently, 77% of all BNs are processed and exported by Bolivia, a country with far fewer resources than its neighbor. This paper analyzes the impact of EU regulations on the global BN market. It finds that Bolivian producers prevailed because they joined forces to revamp their manufacturing practices and meet EU sanitary standards despite continued mutual mistrust. In contrast, Brazilian producers have been unable to work cooperatively and lost access to the European market entirely.

Flying under the radar? The state and the enforcement of labor laws in Brazil

Flying under the radar? The state and the enforcement of labor laws in Brazil
Oxford Development Studies

Coslovsky, Salo
09/16/2013

In recent years, developing countries have deregulated, privatized and liberalized their economies. Surprisingly, they have also retained or even strengthened their labor regulations. These contrasting policy orientations create a novel challenge without obvious solutions. To understand how developing country states can ensure reasonable levels of labor standards without compromising the ability of domestic firms to compete, this paper examines how labor inspectors and prosecutors intervened in four troublesome industries in Brazil. It finds that regulatory enforcement agents use their discretion and legal powers to realign incentives, reshape interests, and redistribute the risks, costs and benefits of compliance across a tailor-made assemblage of public, private and non-profit agents adjacent to the violations. By fulfilling this role, these agents become the foot-soldiers of a post-neoliberal or neo-developmental state.

Moroccan Migrants as Unlikely Captains of Industry: Remittances, Financial Intermediation, and La Banque Centrale Populaire

Moroccan Migrants as Unlikely Captains of Industry: Remittances, Financial Intermediation, and La Banque Centrale Populaire
In S. Eckstein, ed. Immigrant Impact in their Homelands. Durham: Duke University Press.

Iskander, N.
09/06/2013

The impact that remittances – the monies that migrants send home – have on the development on migrant-sending economies is a matter of considerable debate. This essay presents the case of Morocco and its state-controlled bank, La Banque Centrale Populaire (BCP), to argue that the major determinant of remittance impact on development is the quality and breadth of financial intermediation to which migrants have access. By providing a set of financial tools that allowed migrants to deposit, save, and invest with the institution, the BCP, since 1969, simultaneously made remittances funds available the migrants for their personal expenditures and to the Moroccan government for large-scale industrial investment. However, to create financial services for migrants with an appeal broad enough to bring significant amounts of remittance liquidity into the banking sector, BCP had to engage migrants in an open and collaborative process of product design. Ultimately, this paper argues, migrants’ involvement in the design of financial products enabled them to use the banking system to redirect remittances resources to rural and semi-rural areas most migrants were from, and to amend the industrial development priorities of the Moroccan government.

Learning in Place: Immigrant Spatial and Temporal Strategies for Occupational Advancement

Learning in Place: Immigrant Spatial and Temporal Strategies for Occupational Advancement
Economic Geography. 89 (1): 53-75.

Iskander, N., C. Riordan, & N. Lowe.
09/06/2013

Studies of low-wage workers have long recognized the role of space in mediating access to employment. Significantly less attention has been paid to the ways in which space informs workers' ability to develop the attributes that would make them more employable. In this article, we address this gap through an examination of how immigrant workers use the relative spatial organization of residence and production to cultivate the skills that enable them to shift out of low-wage occupations. We also argue that workers' spatial job market strategies have an important, but often overlooked, temporal aspect: workers use space over time not only to shape their access to jobs but also to create breathing room for learning skills that enable them to improve their employment trajectories over the long term. Drawing on a multiyear ethnographic study of Mexican immigrants in downtown Philadelphia, we show that immigrant workers used the functional proximity among the restaurant industry, small-scale residential construction work pertaining to housing renovation, and the neighborhoods where they lived to develop skill sets that enabled them to shift into higher-wage construction jobs. In essence, these workers knitted together two seemingly separate industries, such that they could use their employment time in one for learning in and about the other. Our study suggests that interventions that curtail immigrants' mobility may have implications that are far more serious than limiting immediate access to jobs: these measures may undercut immigrants' strategies for developing the skills required for long-term occupational mobility and advancement.

Moving Skill: The Incorporation of Mexican Immigrants in the US and Mexican Construction Industries

Moving Skill: The Incorporation of Mexican Immigrants in the US and Mexican Construction Industries
In Y. Kutznetsov, ed. How Talent Abroad Supports Growth, Innovation and Institutional Development at Home. Washington D.C.: Migration Policy Institute.

Iskander, N. & N. Lowe.
09/06/2013

Building Job Quality from the Inside-Out: Immigrants, Skill, and Jobs in the Construction Industry

Building Job Quality from the Inside-Out: Immigrants, Skill, and Jobs in the Construction Industry
Industrial Labor Relations Review. 66(4): 785-807.

Iskander, N. and N. Lowe
07/01/2013

Using an ethnographic case study of Mexican immigrant construction workers in two U.S. cities and in Mexico, the authors illustrate the contribution of immigrant skill as a resource for changing workplace practices. As a complement to explanations that situate the protection of job quality and the defense of skill to external institutions, the authors show that immigrants use collective learning practices to improve job quality from inside the work environment—that is to say from the inside-out. The authors also find that immigrants use collective skill-building practices to negotiate for improvements to their jobs; however, their ability to do so depends on the institutions that organize production locally. Particular attention is given to the quality of those industry institutions, noting that where they are more malleable, immigrant workers gain more latitude to alter their working conditions and their prospects for advancement.

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