Munich Personal RePEc Archive

Decent work and the effect of job instability on consumption of Colombian households

Ruiz, Freddy and Lugilde, Alba (2019): Decent work and the effect of job instability on consumption of Colombian households.

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Abstract

The aim of this paper is to study empirically the role of decent work on household consumption in Colombia. Using data from the Large Integrated Household Survey (GEIH) and the Colombian Longitudinal Survey (ELCA) we calculate for Colombia several of the decent work indicators proposed by the International Labour Organization and go one step further constructing their homologous at microeconomic level as measures of the job instability borne by the workers. The constructed indicators measure the poor quality of employment the individuals have which implies uncertainty about future labour income. This work addresses the effect this labour uncertainty has on household consumption. Our results show that being in a situation of vulnerability or labour instability, which generates uncertainty about future income, alters household consumption patterns. This is consistent with the evidence of the existence of precautionary saving in Colombian households.

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