Three essays on the Peruvian labour market

This doctoral thesis studies three phenomena in the labour market which occurred during the period known as the ‘Peruvian Growth Miracle’. From 2005 and until the economic crisis induced by the Covid pandemic, it was characterized by exceptional macroeconomic growth and increased employment and real wages, well above the Latin American average. The first paper decomposes wage differences between Peruvian men and women into parts attributable to differences in labour market attributes and differences in wage structures that women experience in the labour market. Specifically, it studies the evolution across the entire pay distribution of the component associated with gender discrimination experienced by female workers. The effect of those in the informal sector, who are the most affected by this treatment effect, is a central part of the research. The main finding is the presence and the prevalence of ‘sticky floors’, i.e. the confinement of women in low paid jobs, in the informal sector during this period. As important as this, these gaps are primarily explained by the lower reward for their observed characteristics that women obtain in the Peruvian labour market across the wages distribution. The second and third papers study the labour market impacts of the Venezuelan Exodus, a massive immigration inflow which, according to UNHCR, constituted a forced migratory movement of similar relative magnitude to the Syrian case. The first of these papers studies the impact of this exogenous shock on different labour market outcomes for the natives for both the formal and the informal sector. We use a set of novel econometric techniques that pay attention to aspects of the consistency and inference of the treatment effect estimators, whose discussion remained neglected in most of the literature. Since most of the competition with the natives occurs in low-skilled jobs, a particular emphasis is placed on the effect at the bottom of the skills distribution in the host labour market. On average, the Exodus did not have a statistically significant effect on the outcomes studied. Nevertheless, there is a non-negligible adverse effect for those low-skilled native workers in the urban area more exposed to Venezuelan immigration. The final chapter focuses on the Venezuelan migrant population. In particular, it investigates how discrimination experienced by these migrants at the hands of Peruvian employees impacts their wages, and the effect that wage inequities have on their perception of workplace discrimination. The study reveals the existence of migrant pay gaps across the wages distribution, and these are more pronounced when we take a more objective measure of discrimination. Most of these gaps are explained by a treatment effect that affects Venezuelan workers based on their nationality, as these have a higher education level than Peruvians and a comparable work experience. The magnitude of this wage-structure effect affects their perception of workplace discrimination. Nonetheless, variables that reflect migrants’ expectations for equality (e.g., education and experience) have a more sizeable effect.