Robalino, Robalino, David A.

Labor and Youth, Human Development Network, World Bank, Employment and Development Program, German Institute of Labor (IZA)
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Labor markets, Social Insurance
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Labor and Youth, Human Development Network, World Bank
Employment and Development Program, German Institute of Labor (IZA)
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Last updated January 31, 2023
David Robalino is the Lead Economist and Leader of the Labor and Youth Team in the Human Development Anchor of the World Bank.  He also serves as Co-Director of the Employment and Development program at IZA – the Institute for the Study of the Labor.  Since joining the Bank David has been working on issues related to social security, labor markets and fiscal policy. He has worked in several countries in Latin America, the Middle East and North Africa, Sub-Saharan Africa, and Asia.  David has published on issues related to macroeconomics and labor markets, social insurance and pensions, health financing, the economics of HIV/AIDS, and the economics of climate change.  More recently David has been working on issues related to the design of unemployment benefits systems in middle income countries, the extension of social insurance programs to the informal sector, and the integration of social protection and education/training policies to improve labor market outcomes and productivity growth.  Prior to joining the Bank David was a researcher at the RAND Corporation where he was involved in research on health, population and labor, climate change, and the development of quantitative methods for policy analysis under conditions of uncertainty.  David also served in the Presidential Committee for Social Security Reform in Ecuador.  David did his graduate studies at the Sorbonne University in Paris and the RAND Graduate School in Santa Monica – California.  

Publication Search Results

Now showing 1 - 10 of 11
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    Labor Markets in Low and Middle-Income Countries : Trends and Implications for Social Protection and Labor Policies
    (World Bank, Washington, DC, 2012-03) Cho, Yoonyoung ; Margolis, David N. ; Newhouse, David ; Robalino, David A.
    This paper reviews labor market trends throughout the developing world, identifies issues and policy priorities across groups of countries, and derives implications for the World Bank's new social protection and labor strategy. Five key issues are identified: a high and growing share of the labor force that is self?employed or working in household enterprises, exposure to income shocks with limited access to risk management systems, low female participation rates, high youth unemployment rates, and the need to manage migration flows and remittances. The paper then details a three pronged agenda based on providing incentives and conditions for work, improving the efficiency of job creation, and managing risks / facilitating labor market transitions. This suggests that the Bank should emphasize self?employment and entrepreneurship promotion, provision of skills and development opportunities, and facilitation of labor market transitions into and between jobs, while protecting workers from shocks and paying particular attention to youth.
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    Building Social Protection and Labor Systems : Concepts and Operational Implications
    (World Bank, Washington, DC, 2012-03) Robalino, David A. ; Rawlings, Laura ; Walker, Ian
    This paper presents a framework for designing and implementing social protection and labor (SP&L) systems in middle and low income countries. Although the term 'system' is used to describe a country's set of social protection programs, these tend to operate independently with little or no coordination even when they have the same policy objective and target similar population groups. The paper argues that enhancing coordination across SP&L policies, programs, and administrative tools has the potential to enhance both individual program performance as well as the overall provision of social protection across programs. The first part of the paper discusses the characteristics of well?designed social protection systems. It also points to the gains and some of the risks - of moving toward systems, including: (i) more effective risk management in crisis and non?crisis periods; (ii) improved financial sustainability; (iii) more equitable redistribution; (iv) economies of scale in administration; and (v) better incentives. The second part discusses issues related to design and implementation based on country studies for Brazil, Chile, India, Niger, Romania, and Vietnam. It suggests three levels of engagement to support the design of SP&L systems: (a) at the policy level, defining how different instruments (e.g., savings, risk pooling, redistribution) interact, and coordinating financing mechanisms and institutional arrangements; (b) at the program level, improving the design of individual programs and creating synergies with other programs within and across social protection functions; and (c) at the administrative level, setting up basic 'nuts and bolts' tools that can work across programs, such as beneficiary identification and registry, payment mechanisms, and management information systems. The last part of the paper outlines some of the implications of a systems vision for the World Bank's social protection and labor practice.
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    Assessing Interactions among Education, Social Insurance, and Labor Market Policies in a General Equilibrium Framework : An Application to Morocco
    (World Bank, Washington, DC, 2008-07) Marouani, Mohamed A. ; Robalino, David A.
    This paper develops a general equilibrium model to analyze the marginal and joint impacts that alternative macroeconomic, education, and social protection policies have on the dynamics of employment and unemployment by skill level. The model introduces a disaggregated treatment of the labor market that incorporates an informal sub-sector in every sector of the economy. The analysis explicitly models the distribution of skills in the labor force by following over time sex-age cohorts across various levels of the education system and in the labor market. And it integrates a module that projects the revenues and expenditures of the pension system. The model is applied to the case of Morocco. Simulations show that even under positive assumptions regarding economic growth, unemployment rates are likely to remain close to current levels in the next decade. The paper argues that only an integrated package of policies that affect the macro-economy, the investment climate, and the education and social protection systems would allow sustainable creation of enough "good quality" jobs.
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    Assessing the Distortions of Mandatory Pensions on Labor Supply Decisions and Human Capital Accumulation : How to Bridge the Gap between Economic Theory and Policy Analysis
    (World Bank, Washington, DC, 2007-09) Bodor, András ; Robalino, David ; Rutkowski, Michal
    Mandatory pension systems play a major role in individual savings and labor supply decisions. In particular, it is well known that defined benefit pension schemes, which are not actuarially fair, can create incentives for early retirement and therefore reduce labor supply and the stock of human capital in a given country. This is an important policy issue in middle-income countries, with still low participation rates in the labor force, where the "window" opened by the demographic transition is already closed or will close in the near future. In these countries, policies to stimulate private sector growth, competitiveness, and employment creation should be accompanied by policies that increase labor force participation, raising the ratio of active to inactive population and therefore the potential for higher income per capita growth. Unfortunately, the analytical tools developed to assess pension reform options tend to focus on the financial sustainability of the schemes and the adequacy of benefits. Little attention is given in practice to the social costs imposed by distortions on the supply of labor. In part, this is given by the lack of analytical tools that, in the context of limited information regarding individual preferences and behavior, can be used to assess the magnitude of these distortions. This paper develops methodologies that can bridge the gap between economic theory and the practices of pension policy personnel under conditions of deep uncertainty regarding the variables driving individual behavioral responses to policy changes. First, the paper develops an indicator to predict the age-specific retirement probabilities induced by a particular pension system, given heterogeneous individual preferences over risk, consumption, and leisure. The paper then describes how this indicator can be used to project the size of the labor force by gender, age and skill level and therefore the dynamics of human capital accumulation. The integration of these two analytical tools allow us to show the impact of a particular pension reform proposals on the dynamics of labor supply, human capital and, given the dynamics of capital and total factor productivity, economic growth. Furthermore, the paper develops a set of life-cycle income measures for typical individual paths that allow us to measure the contribution of segmented pension schemes to the segmentation of the labor market. The methods are applied to the case of Morocco.
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    Nonfinancial Defined Contribution Pension Schemes in a Changing Pension World : Volume 1. Progress, Lessons, and Implementation
    (Washington, DC: World Bank, 2012) Holzmann, Robert ; Palmer, Edward ; Robalino, David
    Pensions and social insurance programs are an integral part of any social protection system. Their dual objectives are to prevent a sharp decline in income and protect against poverty resulting from old age, disability, or death. The critical role of pensions for protection, prevention, and promotion was reiterated and expanded in the new World Bank 2012-2022 social protection strategy. This new strategy reviews the success and challenges of the past decade or more, during which time the World Bank became a main player in the area of pensions. But more importantly, the strategy takes the three key objectives for pensions under the World Bank's conceptual framework coverage, adequacy, and sustainability and asks how these objectives and the inevitable difficult balance between them can best be achieved. The ongoing focus on closing the coverage gap with social pensions and the new outreach to explore the role of matching contributions to address coverage and/or adequacy is part of this strategy. This comprehensive anthology on nonfinancial defined contribution (NDC) pension schemes is part and parcel of the effort to explore and document the working of this new system or reform option and its ability to balance these three key objectives. This innovative, unfunded individual accounts scheme provides a promising option at a time when the world seems locked into a stalemate between piecemeal reform of ailing traditional defined benefit plans or their replacement with prefunded financial account schemes. The current financial crisis, with its focus on sovereign debt, has enhanced the attraction of NDC as a pension scheme that aims for intra and intergenerational fairness, offers a transparent framework to distribute economic and demographic risks, and, if well designed, promises long-term financial stability. Supplemented with a basic minimum pension guarantee, explicit noncontributory rights, and a funded pillar, the NDC approach provides an efficient framework for addressing poverty and risk diversification concerns.
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    Jobs for Brazil’s Poor : Social Protection Programs and Labor Supply Impacts on the Poor in Brazil
    (World Bank, Washington, DC, 2008-03) Robalino, David ; de la Brière, Bénédicte ; Lindert, Kathy
    The World Bank is carrying out a program of Analytic and Advisory Activities (the Labor AAA) focused on the interface between social protection programs and labor supply and productivity. This focus relates to the debates in Brazil surrounding the issue of helping transfer beneficiaries graduate from poverty and from dependence on transfer incomes. The AAA is structured along two pillars. Pillar I addresses questions related to the impacts of explicit and implicit public transfers on labor supply and savings decisions. In particular, what is the effect of public transfers such as Bolsa Familia and those related to the social insurance system (pensions and unemployment) on work incentives, early entry and retirement, sector choice, and ultimately, public expenditures, human capital accumulation and growth. Pillar II focuses on program design and evaluation. The and goal is to identify how the portfolio of transfer and active labor market programs can be optimized to enhance the employability of the poor, help promote their graduation from poverty, and, ultimately, from dependence on transfer income. In addition, the Labor AAA includes a component to assess public perceptions about Social Protection programs. The Labor AAA is a living program that seeks to respond to questions posed by Brazilian policy-makers as they strengthen the education-social protection-labor market nexus. This approach is helping convene the different stakeholders at the federal level by bringing evidence and policy analysis to the debates.
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    The Financial Crisis and Mandatory Pension Systems in Developing Countries : Short-and Medium-Term Responses for Retirement Income Systems
    (World Bank, Washington, DC, 2008-12) Dorfman, Mark ; Hinz, Richard ; Robalino, David
    The international financial crisis has severely affected the value of pension fund assets worldwide. The unfolding global recession will also impose pressures on public pension schemes financed on a pay-as-you-go basis, while limiting the capacity of governments to mitigate both of theses effects. Governments are reacting to these events in different ways. Some are asking whether the balance between funded defined-contribution and unfunded pension schemes should be reconsidered. A few have already taken actions to reverse prior reforms. This note discusses the potential impacts of the financial crisis on fully funded and pay-as-you-go retirement-income systems in World Bank client countries, and identifies key short-and medium-term policy responses.
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    An Ex-Ante Evaluation of the Impact of Social Insurance Policies on Labor Supply in Brazil : The Case for Explicit Over Implicit Redistribution
    (World Bank, Washington, DC, 2008-07) Robalino, David A. ; Zylberstajn, Eduardo ; Zylberstajn, Helio ; Afonso, Luis Eduardo
    This paper solves and estimates a stochastic model of optimal inter-temporal behavior to assess how changes in the design of the income protection and pension systems in Brazil could affect savings rates, the share of time that individuals spend outside of the formal sector, and retirement decisions. Dynamics depend on five main parameters: preferences regarding consumption and leisure, preferences regarding formal Vs. informal work, attitudes towards risks, the rate of time preference, and the distributions of two exogenous shocks that affect movements in and out of the social security system (independently of individual decisions). The yearly household survey is used to create a pseudo panel by age-cohorts and estimate the joint distribution of model parameters based on a generalized version of the Gibbs sampler. The model does a good job in replicating the distribution of the members of the cohort across states (in or out of them social security / active or retired). Because the parameters are related to individual preferences or exogenous shocks, the joint distribution is unlikely to change when the social insurance system changes. Thus, the model is used to explore how alternative policy interventions could affect behaviors and through this channel benefit levels and fiscal costs. The results from various simulations provide three main insights: (i) the Brazilian SI system today might generate unnecessary distortions (lower savings rates, less formal employment, and more early retirement) that increase the costs of the system and might generate regressive redistribution; (ii) there are important interactions between the income protection and pension systems, which calls for joint policy analysis when considering reforms; and (iii) current distortions could be reduced by creating an actuarial link between contributions and benefits and then giving matching contributions or matching capital to individuals with limited savings capacity, which requires having individual savings accounts that can be funded or notional.
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    Designing and Implementing Unemployment Benefit Systems in Middle and Low Income Countries : Key Choices between Insurance and Savings Accounts
    (World Bank, Washington, DC, 2013-05) Robalino, David A. ; Weber, Michael
    Several middle income countries are considering reforms of severance pay regulations to both increase flexibility for firms and better protect workers. Policy discussions then often revolve around whether to adopt an unemployment insurance (UI) scheme or unemployment individual savings accounts (UISAs). Proponents of the first emphasize its ability to pool risks and introduce an element of solidarity. Critics point to its potentially negative effects on labor supply as individuals can have fewer incentives to seek, take or keep jobs. In this paper, the authors show that UI and UISAs are, in fact, particular cases of a more general design and that the crucial policy choice is in terms of how redistribution - to cover benefits for those who cannot save enough is financed. The authors outline key features of this general design and discuss trade-offs and possible solutions. The authors discusses issues related to implementation and show how recent technological developments around biometric identification can facilitate the monitoring of conditionalities related to participation in job-search and training activities.
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    Labor Policy to Promote Good Jobs in Tunisia : Revisiting Labor Regulation, Social Security, and Active Labor Market Programs
    (Washington, DC: World Bank, 2015) Angel-Urdinola, Diego F. ; Nucifora, Antonio ; Robalino, David ; Angel-Urdinola, Diego F. ; Nucifora, Antonio ; Robalino, David
    Tunisians are striving for the opportunity to realize their potential and aspirations in a country that is rich in both human and physical capital, but whose recent economic growth has failed to create enough opportunities in the form of good and productive jobs. This report highlights the main barriers that hinder the Tunisian labor market from providing income, protection, and prosperity to its citizens and proposes a set of labor policies that could facilitate the creation of better, more inclusive, and more productive jobs. The weak economic performance and insufficient and low-quality job creation in Tunisia is primarily the result of an economic environment permeated by distortions, barriers to competition, and excessive red tape, including in the labor market. This has resulted in the creation of a insufficient number of jobs, especially in the formal sector. To change this situation, policy makers need to address five strategic directives that can promote long-term inclusive growth and formality: foster competition; realign incentives, pay, and benefit packages in the public sector; move toward labor regulations that promote labor mobility and provide support to workers in periods of transition; enhance the productivity of informal workers through training and skills building; and reform existing social insurance systems and introduce new instruments to attain broader coverage.