Questioning the effectiveness of the social protection mandatory regulations for maids in Ecuador

Maids in Ecuador represent one of the sectors that suffer from low income and poor social security. In 2008, a new regulation was implemented, mandating maids’ enrollment in social security. Visits control of households kicked off in 2010, ensuring thus compliance by household employers. A minimum wage was also imposed to ensure a better social protection of maids.

Although such policies appear advantageous, at first glance, for maids in Ecuador; they remain questionable.

Sara Wong (Polytechnic University – ESPOL) argues that this social protection policy resulted in a decrease not only of the number of maids working without social insurance, but also in the number of maids employed.

At the GDN 14th Annual Conference, Wong proposed a different angle to look into the effectiveness the Ecuadorian mandatory regulations for maids, to see whether the compulsory requirements of the mandatory minimum wage and social security coverage have had a negative impact on maids’ employment. The research proposal aims to provide complementary policies ensuring social protection benefits for maids in Ecuador.

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ABCDE 2011: Parallel session on work and gender equality in developing countries

Gender and employment are high on the international development research agenda, with the World Development Report of 2012, focussing on gender equality. This was also the topic of the ABCDE 2011 parallel session #13 dedicated to discuss “work and gender equality in developing countries”.

Rania Roushdy from the Population Council investigated the effects on women in the Egyptian labor market during the economic downturn. The paper provided new research evidence on the impact of the financial crisis on the female labor market. This is expected to help in shaping country-specific policies to undermine the adverse effect of the crisis.

Secondly, Rana Hendy, Researcher at the Economic Research Forum, presented her paper on “Marriage and labor market transitions: A structural dynamic model”. This research investigates the effect of marriage on labor market transitions and employment choices. The results show greater state dependence for the public than for the private sector over time. Marriage decreases the public employment probability by 18% and the private one by almost the double (30%).

Finally, Gaëlle FerrantParis School of Economics, explored the peer effect on the labor market participation in South Africa. The question is whether being surrounded by active or employed peers influences the probability to both be active and employed, and the wages. Results show the presence of peer effects on market choice and outcomes confirms that social interaction matter.

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ABCDE 2011: Keynote address by Andrés Velasco

Andrés Velasco, former Finance Minister of Chile and Adjunct Professor of Public Policy at the Center for International Development (Harvard University) addressed the connection between employment, income distribution and inequality in his keynote speech at the ABCDE 2011 event.

Andrés Velasco, Harvard University

According to Mr. Velasco, Chile is an unequal country. The country went from being pre-industrial to post-industrial without ever being industrial. To reduce inequality in Chile,  Mr. Velasco reiterated the necessity to improve child care and urban housing, introduce flexible working hours and provide information on job availability. He also highlighted the importance of creating linkages between commodities and value added around those commodities. Mr. Velasco concluded by stating that there is no one factor that keeps poor people from regular employment, and “therefore there is no one solution”.

On the correlation between inequality and income growth in Latin America, Velasco clearly stated that Latin America has failed to grow much over the past years, part of it because of inequality which is mainly due to bad policies.