The Effect of One-On-One Assistance on the Compliance with Labor Regulation. A Field Experiment in Extremely Vulnerable Settings

Abstract

This is the first paper to analyze the effects of intense personal assistance on the compliance with labor regulation, within a population of deeply disadvantaged informal workers, using a field experiment. We randomly assign one-on-one assistance to these workers, and, within this treatment group, we randomly assign money to cover the cost of fulfilling the legal requirements to get a permit to work on the streets. One month after the intervention, we find that a worker who receives one-on-one assistance is three times more likely to comply with the legal documentation required by the government than a worker in the control group. We also find that a worker who receives both one-on-one assistance and cost coverage is four times more likely to comply with the legal requirements. The findings of this study shed light on strategies to help highly vulnerable workers to comply with labor regulations. (JEL C93, D04, J46, J62, I30) Keywords: case management; one-on-one assistance; randomized control trial; field experiment; labor regulation. Montevideo (e-mail: acid@um.edu.uy); Bernatzky: Yale University (e-mail: marianne.bernatzkykohli@yale.edu). The authors thank María Cecilia Ramírez for superb research assistance, and would like to specially acknowledge María Laura Alzúa for her very helpful comments at different stages of this project. We are extremely grateful to