Data and Code for: Employment Preferences of Favela Residents

We document employment preferences of workers at the margin of informality using open-ended questions
and discrete choice experiments in Brazil’s largest favela complex. Stated preferences emphasize pay
and tangible job benefits rather than meaning or purpose, while primary complaints center on poor
management, customers, and inflexible schedules. Workers exhibit high valuations for all formal sector
amenities on average—unemployment insurance, parental leave, and termination notice—as well as for
learning opportunities, but lower for non-formal sector amenities such as shorter commutes. Valuations
vary systematically by employment sector in ways consistent with sorting: formal workers value formal
amenities most, the self-employed value them least or not at all, and the informally employed exhibit
mixed valuations. These patterns are also consistent with learning and endowment effects, for which we
find suggestive evidence.