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Abstract

This paper examines the role of the informal labor sector in Bolivia during the pandemic and the confinement contributing to food security. The particularities of this sector in a developing economy and the importance of its networks in its economic, social and political development are explained.
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Introduction
Bolivia had a period of great prosperity between 2006 and 2014
due to the boom in the prices of its exports, basically gas, minerals and
soy. Starting in 2014, export earnings decreased, imports continued to
grow, international reserves declined, and unemployment increased.
In 2019, the economy ended battered so it was expected to have a bad
year in 2020, which was aggravated by the pandemic that struck the
entire world.
Although it is still early to assess losses, on-site observations show
a great resilience of some sectors of informal workers. The World Bank
estimated a decrease of 5.9 percent of the Gross Domestic Product for
2020 and anticipates a recovery of 2.2 percent the following year. For
the large economies, it predicts much larger declines in output with a
signicant recovery in 2021.
The Bolivian economy is that of a non-industrialized country: few
large companies and an important number of small companies, many
of them with only one worker, operating outside the legal provisions
and with low returns. But what is a weakness in normal times, can be
a strength in times of crisis.
Faced with the instability of employment that characterizes
developing countries, workers adopt 4 strategies: they acquire
various job skills, distribute household members in different jobs,
diversify their investments and insert themselves into family or social
networks of mutual support, horizontal and vertical. The former are
unions organized by economic activity or occupations, the latter
bring together workers at different levels of complementarity. In
them, networks linking farmers to transporters and traders provide
food security to cities. These networks are formed around extended
families and / or members of the same place of origin.
These strategies lead to the creation of small businesses. Large
companies are capital intensive, while small companies have little
capital and low xed costs, which allows them to change their activity
depending on the economic situation, seeking to minimize losses.
With the arrival of the pandemic and the rigid connement imposed
by the authorities, there was great fear that there would be food
shortages and that informal workers would see their incomes drop
sharply. However, they were able to secure food supplies in the cities
and prevented their income from falling sharply, often violating legal
provisions. Other informal workers did not have the same luck, but
some of them, especially among the masons, returned to agricultural
activity and inserted themselves into the food network. Frequently, the
informal economy is thought to provide a “cushion” during crises to
those who lose jobs. However, this is possible only if the unemployed
have links with some network of informal workers.
The Bolivian informal labor sector
Two currents to explain the existence of the informal sector
predominate in economic and social thought: the institutionalism and
the structuralism. The rst, promoted by Hernando de Soto,1 proposes
that the existing institutional restrictions in the labor market, the high
tax burdens and the heaviness of the procedures to be formal lead
many rms and workers to opt for informality, that is, to work outside
the legal order. The second trend2 proposes that inequality of labor
skills closes the door of formality to less qualied workers, giving
rise to segmented labor markets.3,4 Many believe that informality is
characteristic of underdevelopment and that as countries develop,
informality decreases.5,6
Not far from the structuralism trend, but with our own perspective,
we postulate7 that labor informality is explained by the segmentation
of the market for goods and services resulting from inequality in
income distribution and inequality in job training. The unequal
distribution of income leads to differentiated demands for goods and
services: the wealthy strata demand goods produced or marketed
by formal establishments that hire skilled workers, while low or
moderate income families are not very demanding on quality on
condition of obtaining a lower price. Responding to their demand,
there are goods produced by workers with lower qualications. They
are informal workers. There are a large presence of indigenous worker
among the informal ones due to the fact that they have not had the
same training opportunities as the rest of the population and also due
to the transcendence of feudal relations (boss vs. servant) still existing
in the Andean region. In general, they continue to have ties to their
families in rural areas.
Feudal sways in Andean societies lead elites to discriminate against
indigenous populations, closing the door to well-paid or prestigious
jobs. Aware of this lack of opportunities, some families do not want
their children to obtain good levels of job qualication and push them
to the labor market early without giving them the opportunity for
further training. They swell the ranks of the informal.
Sociol Int J. 2020;4(4):9295. 92
©2020 Morales. This is an open access article distributed under the terms of the Creative Commons Attribution License, which
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The resilience of informal workers to COVID19 and
to the difculties of trade
Volume 4 Issue 4 - 2020
Rolando Morales
Universidad Mayor de San Andrés in La Paz, Bolivia
Correspondence: Rolando Morales, Director of the Ciess-
Econometrica research, Universidad Mayor de San Andrés in La
Paz, Bolivia, Email
Received: June 29, 2020 | Published: August 12, 2020
Abstract
This paper examines the role of the informal labor sector in Bolivia during the pandemic
and the connement contributing to food security. The particularities of this sector in a
developing economy and the importance of its networks in its economic, social and political
development are explained.
Keywords: labor informality, network, trade, pandemic, lockdown, JEL classication:
F16, F66, I12, I15, J46
Sociology International Journal
Mini Review Open Access
The resilience of informal workers to COVID19 and to the difculties of trade 93
Copyright:
©2020 Morales
Citation: Morales R. The resilience of informal workers to COVID19 and to the difculties of trade. Sociol Int J. 2020;4(4):9295.
DOI: 10.15406/sij.2020.04.00232
The informal labor sector is characterized by the large presence
of women who nd in it a way to reconcile domestic tasks (childcare,
household) with paid work. For many young migrant women of
peasant origin, the informal sector is an experience where they learn
the customs and rules of the cities.
Having established the main currents of thought, it should be noted
that reality is quite blurred. On the one hand, goods and services
markets as well as labor markets overlap to some extent. On the other
hand, some segments of the informal group achieve incomes higher
than the highest formal income, especially those that are inserted in
foreign trade operations, while others have lower incomes than the
lowest formal income. To illustrate that some informal workers are
doing very well, it is worth mentioning that some have developed
a new architecture in the city of El Alto with the name of “cholet”
(abbreviation of chalet and cholo) with the support of a large Aymara
artist Freddy Mamami. The cholets are 4-8 story buildings that have
an American style chalet on the top oor while the ground oor is
reserved for commercial activities. The facades have original Mamani
paintings.
In this complex reality, it is also possible to nd that some workers
voluntarily choose to be informal while others do so because they
cannot nd work in the formal.2,8 Another point worth noting is that
the informal sector is generally not free to enter because it requires the
consent of the power groups that they control and that are organized
in unions and families. Ignoring that the large presence of informal
workers is a stage in the development process, some authors postulate
that it should disappear. They take no notice of that all the countries of
the world have gone through that stage.
The informal economy tends to be stigmatized as “illegal”,
“underground”, “black market” or “grey market”. It is often called
the “shadow economy” and characterized as illegal or unethical
activity. The generalization is unfair. The vast majority of informal
workers are trying to earn an honest living against great odds. Rather
than working in the shadows, a great many works in public spaces
and make huge contributions to communities and economies (www.
wiego.org/informal-economy).
Economic activities of the informal workers
The activities of informal workers can be divided into 3 groups:
in urban areas, in mining and in agriculture. In urban area, there are
4 major groups of informal workers: merchants, transporters, masons
and artisans. Among the merchants, there are three groups: those who
work linked to the external sector, those who sell locally imported
good and who sell agriculture products. Among the former, there are
very prosperous and skilled merchants who have even been able to
establish uid trade routes with China by installing establishments
in the Asian country that facilitate the importation of all kinds of
products. Small merchants are responsible for selling these products
and others that come from neighboring countries. Finally, there is the
large group of merchants of agricultural products. When prices are
over $50 and buyers ask, merchants issue invoices, setting foot on
the formality.
In urban areas, half a million drivers work with their own taxis and
buses. They are self-employed and maintain links with agriculture and
commerce. They use their cars to bring agricultural products to the
cities in the early morning. Often their spouses are the merchants who
will sell these products in local markets.Among street vendors, those
who prepare and sell food are relevant. They are important because
they guarantee food security for many people.
In the construction sector, bricklayers are hired on a daily basis and
paid weekly. They have no employment contract or social benets,
not even accident insurance. Most of them combine agricultural work
with construction work. Artisans who formerly made clothing, shoes
and leather goods have gradually disappeared due to the importation
of manufacturing products from China at a very low price.
The other two major groups of informal workers are in mining
and agriculture. Informal mining has always existed in Bolivia as a
cushion for the crisis in the sector, but in the last decade it has grown
a lot due precisely to the high price of minerals that made it possible
to exploit low-value veins with artisan instruments.
Since the Agrarian Reform of 1952, the agricultural activity of
western Bolivia has been in the hands of more than half a million
peasants who work on their own in very precarious conditions and
with low yields. Informal urban workers have multiple labor skills
which gives them great job mobility. That is why workers cannot
be easily slotted into one occupational group. For example, a home-
based worker may produce a variety of goods and services across
many industries, or may engage in street trading to sell what she
makes (wiego).
The merchants and artisans, who are the majority among the
informal ones, are organized in unions with high cohesion and are
politically strong. Their cohesion comes from the economic ties
that unite them and from ties of a family or geographical origin. In
some markets, most of the stalls are owned by members of the same
family. It is necessary to remember that in Latin America, the concept
of family is very broad. Another cohesion factor is coming from the
same town, region or ayllu. As is known, the more cohesion a group
has, the more impermeable it is in relation to non-group members. All
this leads to preventing the entry of members from outside the group
to stalls that were appropriated by the rst arrivals. Starting with the
formation of unions at the market or neighborhood level, they build a
pyramid organization with political force and negotiating power.
Bolivia has some two hundred thousand informal miners, most
of them come from the old state mines that were abandoned in the
1990s and many of them combine mining with agriculture. They are
organized in local guilds and an important national guild. Politically
they are very strong to the point of continually achieving undeserved
advantages from the government and of appointing mining ministers
among their.7 The bricklayers and farmers do not have important
unions that defend their interests.
Resilience during the connement
The context
From March 22, 2020, Bolivia adopted strict lockdown until
June 15, later adopting a more exible form of connement, but in
many regions, it had to resume it due to the severity of the pandemic.
With economic activity paralyzed, due to connement for about 3
months that could lengthen, fear spread due to its possible impacts
on vulnerable groups, especially among informal workers. There was
also fear that food would be lacking. The lockdown is expected to last
through August, leaving many in desperate economic circumstances.
In February and March, the pandemic was mild, especially in the
Altiplano, which is why many people supported the hypothesis that
altitude and exposure to the sun would slow the spread of the virus,
so they thought that government regulations were excessive and they
uselessly damaged their work and income. This idea was deeply rooted
The resilience of informal workers to COVID19 and to the difculties of trade 94
Copyright:
©2020 Morales
Citation: Morales R. The resilience of informal workers to COVID19 and to the difculties of trade. Sociol Int J. 2020;4(4):9295.
DOI: 10.15406/sij.2020.04.00232
in urban and rural informal workers who reacted more than once
violently against the police and the military who control the closure.
The government said the protests were dictated from Argentina by
former President Evo Morales and arrested many informal workers,
accusing them of conspiring, although they only claimed the right to
work.
Another scenario that harmed health policy and governance
was given by the proximity of the general elections to be held on
September 6 and which could lead to the victory of former President
Evo Morales’ political party, supported by the low-income population,
among them, the informal ones.
The government, like other governments in Latin America,
arranged the distribution of money among all Bolivians to face the
fall in their income, but this did not calm the protests as the workers
insisted that they wanted to work. With the arrival of winter in the
month of June, the cases of Covi19 increased greatly, which led to
softening prejudices and the leaders of peasants and informal workers
began to express some fear.
The reactions
In normal times, informal workers play an important role in the
economy, especially with regard to food security. This sector ensures
synergy between the countryside and the city and makes it possible
to offer fresh, good quality agricultural products at reasonable prices.
When rigid connement was adopted, inter-province transportation,
walking on the streets and using cars were banned, small businesses
were closed, but large stores were allowed to open a few hours and to
make home deliveries. Banks were only entitled to open 4 hours per
day. School establishments were closed.
The regulations adopted to prevent families from buying food.
In this situation, informal workers operated their networks to offer
food in urban centers, although many times they violated the norms
established by the authorities. They brought agricultural products to
the cities in the cars of the members of their networks and installed
small stalls in all the neighborhoods of La Paz. Four types of
informal workers participated in this scheme: merchants, transporters,
masons and peasants. The masons were inserted into these networks
thanks to the ties they had with their family members in rural areas.
Informal workers violated the transport and trade prohibition, but
made it possible to offer fresh and reasonably priced food, albeit
slightly higher than in force before the pandemic. They contributed
to decongesting large markets, avoiding crowds. The use of masks
and maintaining social distance became widespread among vendors
and customers, but it was impossible under these circumstances to
promote frequent hand washing. Some used gel alcohol to disinfect
their hands and their products.
Due to logistical problems, large stores were crowded and they
were quickly saturated with demands for home deliveries. To deal
with this problem, informal traders organized home delivery services
from neighborhood markets and also using motorcycles for longer
distances. And they expanded their services by offering elaborate food
and drinks and they expanded the motorcycle service to all kinds of
products, including drugs.
Street and market informal workers feel that they are facing
unfair competition from supermarkets during the pandemic. While
they can only sell essential goods, supermarkets can sell all sorts of
products. And every day comes with the uncertainty of whether they
are exposing themselves to the virus in the process.
Like in many other countries, in the early days of the pandemic,
panic spread and everyone rushed to pharmacies to buy face masks,
soaps, and disinfectant alcohol, quickly depleting supplies. The
Bolivian government rushed to make millionaire orders to China,
but an offer quickly appeared with local products made by informal
workers in large quantities. What were scarce products, began to be
sold at reasonable prices in all corners of Bolivia.
This strategy was possible, especially in the city of La Paz, where
vegetables, fruits, even meat, chickens and sh are offered outdoors
without the risk of rotting or bringing diseases due to height, sun rays
and scarce density of oxygen in the air. In La Paz, there are no large
crowds like in Lima, Río de Janeiro or Medellin. The cities of Oruro
and Potosí also have the same characteristics and in them it is possible
to avoid large crowds, which is not the case in the populous city of El
Alto where there are large numbers of people sharing small spaces.
In El Alto and Cochabamba the protests against the connement
were strong and turned violent amid some level of disbelief about
the effects of the pandemic and the political conict explained above,
but they were also able to organize the aforementioned cooperation
networks for La Paz.
Health issues
Due to the frequent violation of health standards by informal
workers, there is a justied fear that the pandemic may continue to
spread. However, it is still early to express an opinion on the matter.
Only two facts should be highlighted: until June, Bolivia was in
an intermediate range of infected cases per million inhabitants in
Latin America, but it shows a worrying regional distribution of this
disease. On June 21, while Chile had 12.6 thousand cases per million
inhabitants, Peru 8 thousand and Brazil 5 thousand, Bolivia had only
2,200, but more than Argentina (952), Paraguay (193) or Cuba (206).
Future research may explain the reasons for these differences, if they
continue.
On the other hand, regional differences are disturbing, La Paz
has 540 cases per million inhabitants and Santa Cruz has 8 times
more. Between both regions, there are differences in altitude, solar
radiation, temperature and also in the composition of the population.
The population in La Paz is mainly of Aymara origin, especially
the informal workers. As is known, cultural differences can imply a
behavioral difference. Compliance with sanitary regulations was more
lax in Santa Cruz than in La Paz. But it is necessary to insist on the
fact that the possibility that climatic or cultural factors may explain
these differences is not proven.
Trade-off between trade and domestic
production
As explained above, a signicant part of informal traders work
on importing products from China and neighboring countries and in
their internal marketing. Furthermore, the numerous informal miners
export their products. In both cases, the workers operate without
respecting the rules and were harmed by the closure of the Bolivian
borders. Possibly the closure of the borders will be prolonged until
the end of the year due to the problems in China and the high number
of cases of Civd19 in Brazil, Peru and Chile, neighboring countries
with Bolivia.
Miners can hold their stocks for some time, but they will quickly
have liquidity problems which can eventually be solved by banks
with the help of the government. A signicant portion of the miners
The resilience of informal workers to COVID19 and to the difculties of trade 95
Copyright:
©2020 Morales
Citation: Morales R. The resilience of informal workers to COVID19 and to the difculties of trade. Sociol Int J. 2020;4(4):9295.
DOI: 10.15406/sij.2020.04.00232
is linked to the land, which opens up the possibility of returning to
agricultural activity.
The difculty to import manufactured products from China or
neighboring countries is a severe blow to many informal workers.
However, it is also the occasion to relaunch local production generating
employment. Several industrial sectors have the capacity for this,
particularly the manufacture of clothing, footwear, leather products
and food processing. Taking into account that the production facilities
and networks remain intact, the recovery of the Bolivian economy and
the replacement of the jobs and incomes of informal workers requires
only an adequate post-pandemic macroeconomic framework and the
possibility of distributing over time business and state losses.
Bolivia has been dragging a signicant backward exchange rate for
a long time, being one of the causes of the growth of imports. In this
time of crisis, there is a consensus not to change the exchange rate due
to its impact on ination, but the quantitative restrictions on imports
emerging from health policy may be extended for a few months. This
will allow expanding and securing the market for national producers.
On the other hand, it is necessary to ensure price stability with policies
that slow down the growth of the scal decit. It is also convenient to
establish some mechanism to support non-traditional exports.
Since many companies have had losses during connement, it is
necessary to establish new rules to renance the debts and nance the
losses to make possible their absorption over time. The construction
sector may be in difculties, which would mean the unemployment of
thousands of bricklayers. Informal mining requires special treatment.
The government intends to create trust funds to nance the
companies, but the short time remaining in its management makes
it unlikely that this will happen. The possible winners of next
September’s elections have not yet made their proposals known.
In any rehabilitation plan it is important to take into account local
synergies, in particular existing networks.
Conclusion
Several conclusions emerge from the previous explanations.
The main one is that the informal sector has been very important in
ensuring the supply of food during the pandemic, which, at the same
time, has allowed it to preserve its income to some extent. All this they
are putting their health at risk, although they showed enough care in
the use of Biosafety materials. For some time, many workers have
shown disbelief about the severity of the pandemic because it initially
had no strong impact in the country. They thought that the altitude, the
solar rays and the temperature would slow down the virus and that the
policy of connement was excessive. The disbelief of many workers
and the political conict that opposed the government with the Evo
Morales created an atmosphere of violence and mistrust.
There was fear that informal workers would contribute to the
spread of the pandemic, but its incidence in Bolivia remains moderate,
although with a tendency to grow, but it is worrying that there are
many cases in the lower parts of the country. Accompanying these
descriptions, important clarications have been made about what the
informal work sector means in a country like Bolivia, and the need to
count on it for the post-pandemic economic recovery.
Acknowledgments
None.
Conicts of interest
The author declares no conicts of interest.
Funding
This research was supported by funds from the Swiss Program for
Research on Global Issues for Development (r4d program) under the
thematic research module “Employment in the Context of Sustainable
Development” and the research project “Trade and Labor Market
Outcomes in Developing Countries”.
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3. Field G. Segmented labor market models in developing countries. In: Don
R, KInkald H, editors. The Oxford Handbook of Philosophy of Economics.
Oxford University Press. 2009.\
4. Jiménez D. Labor Informality in Latin America: a structuralist or
institutionalist explanation? Cuadernos de Economía. 2012;3(58):113–
143.
5. Loayza N. Informality in the Process of Development and Growth. The
world Economy. 2016;39(12).
6. Fiess N, Fugazza M, Maloney W. Informal Labor Markets and
Macroeconomic Fluctuations. Policy Working Paper, World Bank. 2006.
7. Morales R. Mineral Trading and Informal Labour in Bolivia”. Revista
Economía Coyuntural, Universidad Gabriel René Moreno. 2020;5(2).
8. Morales R, Agramont D, Cueto M. Voluntary and Involuntary Labor
Informality. 2015.
... The Bolivian economy is not industrialized and has few large firms and a significant number of small firms (Morales 2020). In Bolivia, eight out of ten jobs are created in small firms, which contribute 83% of Bolivian employment (Opinión 2017). ...
... Around 9% of the employment in Bolivia is concentrated in this industry (INE 2020). Moreover, Morales (2020) suggests that this industry is characterized by strong economic relationships with suppliers from the informal economy. Therefore, for our research, we sampled industries from the foods and beverage industry, which reveals important information about sustainable supply chain management practices in Bolivia. ...
Chapter
Full-text available
Nowadays, Bolivia is experiencing big social and economic changes. Due to strong economic growth and deep political changes, the Bolivian society has high expectations for a better future. Multiple factors, most rooted in changing consumer realities, are driving the awakening to the importance of the management and sustainability of supply chains in developed and developing countries. More consumers are also looking for reassurance from manufacturers that their purchased goods are sourced and produced in an environmentally, socially sustainable, and safe fashion. As a consequence, more national regulations are expected to appear in the future to reflect these new consumer demands. Due to social and political instability, attaining supply chain sustainability in Bolivia is far from realistic. However, manufacturers should take several steps to address some of the factors that limit their control over supply chains. Bolivian firms will have to reduce suppliers’ complexity, improve supply chain transparency, integrate third parties, and improve material procurement practices. Therefore, our study analyzes sustainable supply chain management practices in the foods and beverage industry of Bolivia. In this chapter, we study the case of Bolivia and attempt to summarize the challenges and opportunities faced by Bolivian firms in the development of sustainable supply chains. In particular, we collected data from nine foods and drink manufacturers of the foods and beverage industry. We find that the implementation of sustainability practices in Bolivian supply chains is still at an early stage. Moreover, due to high political instability and a huge informal economy, supply chains in Bolivia are highly uncertain and extremely challenging to manage.
... The Bolivian economy is not industrialized and has few large firms and a significant number of small firms (Morales 2020). In Bolivia, eight out of ten jobs are created in small firms, which contribute 83% of Bolivian employment (Opinión 2017). ...
... Around 9% of the employment in Bolivia is concentrated in this industry (INE 2020). Moreover, Morales (2020) suggests that this industry is characterized by strong economic relationships with suppliers from the informal economy. Therefore, for our research, we sampled industries from the foods and beverage industry, which reveals important information about sustainable supply chain management practices in Bolivia. ...
Preprint
Full-text available
Nowadays, Bolivia is experiencing big social and economic changes. Due to strong economic growth and deep political changes, the Bolivian society has high expectations for a better future. Multiple factors, most rooted in changing consumer realities, are driving the awakening to the importance of the management and sustainability of supply chains in developed and developing countries. More consumers are also looking for reassurance from manufacturers that their purchased goods are sourced and produced in an environmentally, socially sustainable, and safe fashion. As a consequence, more national regulations are expected to appear in the future to reflect these new consumer demands. Due to social and political instability, attaining supply chain sustainability in Bolivia is far from realistic. However, manufacturers should take several steps to address some of the factors that limit their control over supply chains. Bolivian firms will have to reduce suppliers’ complexity, improve supply chain transparency, integrate third parties, and improve material procurement practices. Therefore, our study analyzes sustainable supply chain management practices in the foods and beverage industry of Bolivia. In this chapter, we study the case of Bolivia and attempt to summarize the challenges and opportunities faced by Bolivian firms in the development of sustainable supply chains. In particular, we collected data from nine foods and drink manufacturers of the foods and beverage industry. We find that the implementation of sustainability practices in Bolivian supply chains is still at an early stage. Moreover, due to high political instability and a huge informal economy, supply chains in Bolivia are highly uncertain and extremely challenging to manage.
... In current COVID-19 scenario, mental distress is a matter of concern for the organization and society (Joseph et al., 2020). New normal work culture, worry of losing jobs and fear of getting infected from virus during COVID-19 have forced employees to adapt and change themselves accordingly (Morales, 2020). Distress caused by COVID-19 severely impaired the positive side of an employee such as optimism, hopefulness, self-efficacy, self-esteem and quality of work life (Ahmed et al., 2020). ...
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Effective inventory management influences every aspect of a firm's operations. Inventory management in developing countries is a difficult business process because firms do not use basic inventory control concepts and techniques. Moreover, developing countries are characterized by trade imbalances with developed countries due to process inefficiencies, bureaucracy, and communication problems. This leads to longer lead times and supply uncertainty. Consequently, firms attempt to overcome the supply uncertainty by carrying unnecessary amounts of buffer stocks. We analyzed the inventory management system of an international lifestyle product retailer in Bolivia and found that, as the literature predicted, the firm showed no use of basic inventory control techniques. Particularly, it did not make data-driven decisions, lacked an effective inventory management system, or knew which products had higher consumer demand, and thus worked under a high level of supply uncertainty and inventory management illiteracy. Therefore, to reduce supply uncertainty, we developed a new inventory management system based on two strategies: (a) strategies to reduce demand uncertainty; and (b) strategies to reduce process uncertainty. Specifically, we implemented triple exponential smoothing for product demand forecasting, ABC segmentation to identify the most important products in the firm's portfolio, the newsvendor model to determine optimal inventory levels, powers-of-two policies, to optimize reorder times, and Turnover Based Metrics to arrange SKUs in the warehouse. Overall, our results suggest the significance of taking into account the country in which any firm operates. Hence, it should not be a surprise that in developing countries firms show high buffer stocks and generally adopt reactive flexibility practices.
Chapter
A region is considered food secure when all of its four pillars are met: accessibility, affordability, safety and utilization. Unfortunately, developing countries such as Bolivia presents a very high food insecurity index, due its high levels of poverty. The paper aims to discover relevant factors that people with an average income for the region, located in peripherical areas, considers at the moment of acquire their family basket, especially fruits and vegetables, and how their environment affects their purchase decision regarding fresh and healthy food. The study was performed on Cochabamba – Bolivia during the time of the pandemic crisis of 2020.
Chapter
The lower Tejo river basin is an important crop production area in Portugal. The mild climate, diverse water sources and availability along with flat and fertile land areas provide the condition to a highly productive region. Although the historically rainfed cultures installation since the eighteen century, irrigated cultures, such as rice, started to gradually occupy the region in the beginning of the twentieth century. Nowadays, rice cultivation prevails in the area, which requires reliable sources to fulfil water demand for this culture. Paddy-rice fields installation in Tejo tributaries alluvium, such as Sorraia and Almansor rivers, directly supply those parcels in the vicinity. Nevertheless, the largest production area is installed in Lezírias de Vila Franca de Xira, located in Tejo alluvium plains. Such area requires large amounts of water during crop season, from April to October, mainly withdrawn from Tejo river. The Tejo estuary proximity and its salinity influence along with demand peak during summer compromise water quality which, in a long term, can cause salinization and alkalinization of soils. Rice is a light salinity tolerant culture, which is adapted with the current water quality, but the region faces serious sustainability challenges if a shift for some other crop type occurs, as happened in the past. Multiple Correspondence Analysis was used as a statistical method to assess water quality in the region. Water management, driven with water quality allocation by crop and soils requirements can be an answer to minimize permanent soil damages achieving natural resources sustainability in the long term.
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In Peru and Bolivia, the recent boom (2006-2014) in the export prices of minerals has led to four phenomena: a) growth in informal and often illegal work in mining; b) increased labour exploitation; c) conflicts among formal and informal miners, and peasants; d) conflicts with transnational companies and with the state. We show that the recent growth of informal work in the mining industry is different from the one caused by past crisis in the sector. We analyse the economic logic of the export-oriented mining activity in order to determine how it has given rise to the informal sector. In a first step, we show how the recent export price boom led to growth in informal labour in the mining industry. Subsequently, we explain the importance of mining and international trade to Bolivia as well as the historical roots of labour informality caused by mining crises. We explain some important characteristics of the informal sector and its political empowerment. We conclude by weighing the importance of labour informality as a shock absorber during crises in the mining sector. To the best of our knowledge, no studies have previously examined labour informality in the mineral trade economy. JEL: F16, J46, Q32, Q33, Q34.
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This paper examines the adjustment of developing country labor markets to macroeconomic shocks. It models a two sector labor market: a formal salaried (tradable) sector that may or may not be affected by union or legislation induced wage rigidities, and an unregulated (nontradable) self-employment sector facing liquidity constraints to entry. This is embedded in a standard small economy macro model that permits the derivation of patterns of comovement among relative salaried/self-employed incomes, salaried/self-employed sector sizes and the real exchange rate with respect to different types of shocks in contexts with and without wage rigidities. The paper then explores time series data from Argentina, Brazil, Colombia and Mexico to test for cointegrating relationships corresponding to the patterns predicted by theory. We identify two types of regime. The first corresponds to periods where demand shocks to the nontradable sector offer new opportunities to (informal) entrepreneurs, the informal sector expands “procyclically,” and the exchange rate overshoots toward appreciation in the short run, or remains at its productivity determined levels. The second corresponds to periods of negative shocks to the formal salaried sector in the presence of wage rigidities where the sector plays a more traditional “buffer” role during downturns.
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This article analyzes the behavior of informality for a group of Latin American countries assuming a theoretical approach, which takes into account structural and institutional explanations, in an attempt to determine through an econometric exercise what explanation is more relevant. Socioeconomic information is taken from multilateral agencies; the results of the econometric exercise highlights the feasibility of modeling the behavior of informality econometric structures that take into account structural and institutional cutting variables.
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Labor markets are important, because most people, especially the poor, derive all or the great bulk of their income from the work they do. This paper approaches labor markets through models of segmented labor markets. The first main substantive section presents the essence of segmented labor market modeling, in particular, the role of labor market dualism. Given that labor markets often consist of quite distinct segments, a useful and insightful analytical approach is to start with just two interrelated segments, which here are termed formal and informal. Accordingly, the next sections present models of wages and employment in the formal sector, the informal sector, and the linkages between the two respectively. The final substantive section shows the contributions that these models make to understanding and policy analysis in labor markets. It would not be expected that the same model would fit East Africa and East Asia or South Africa and South Korea. Surely, the “correct” model is context-specific. Blending empirical observation and analytical modeling has yielded great advances. Sound labor market policies require sound labor market models.
Informality Revisited". Policy Research Working Paper 2965
  • W Maloney
Maloney W. Informality Revisited". Policy Research Working Paper 2965. World Bank. 2003.
Voluntary and Involuntary Labor Informality
  • R Morales
  • D Agramont
  • M Cueto
Morales R, Agramont D, Cueto M. Voluntary and Involuntary Labor Informality. 2015.