Direct and Spillover Effects of Enforcing Labor Standards

Abstract

I study how increases in labor standards and enforcement affect workers and their families. Using a policy in Argentina that targeted domestic workers and their employers, I find a 31 percent increase in formality rates of domestic workers and an increase in monthly earnings of almost 4 percent, despite a reduction in hours of work. I also study whether the reform produced changes among other members of domestic workers’ families. I find a substantial reduction in labor supply among children of domestic workers (especially women).