Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/278993 
Year of Publication: 
2023
Series/Report no.: 
IZA Discussion Papers No. 16295
Publisher: 
Institute of Labor Economics (IZA), Bonn
Abstract: 
Most workers in the developing world do not receive the benefits they are legally entitled to. Why, then, is there so little public enforcement? This paper argues that this is partly because of a lack of an autonomous and professional bureaucracy. Using a novel dataset with objective measures of labor inspections and fines across countries, we show that Weberian bureaucracies are more likely to enforce labor standards. We provide OLS and 2SLS estimates that address endogeneity concerns and use ethnographic evidence collected in Latin America to understand the mechanisms better. The case study suggests that politicized bureaucracies underinvest in labor inspection because elected officials have short-term horizons and do not internalize the social benefits of enforcement (such as formal job creation and enhancement of the rule of law) because they take time to materialize.
Subjects: 
enforcement
autonomy
compliance
state-capture
labor
JEL: 
J88
K42
O17
P50
Document Type: 
Working Paper

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