Will Working from Home Stick in Developing Economies?

WillWorkingfromHomeStickinDevelopingEconomies? MarinaConesaMartinez,FutoshiNarita,andChrisPapageorgiou WP/23/112 IMFWorkingPapersdescriberesearchinprogressbytheauthor(s)andarepublishedtoelicitcommentsandtoencouragedebate. TheviewsexpressedinIMFWorkingPapersarethoseoftheauthor(s)anddonotnecessarilyrepresenttheviewsoftheIMF,itsExecutiveBoard,orIMFmanagement. 2023 MAY ©2023InternationalMonetaryFundWP/23/112 IMFWorkingPaper ResearchDepartment WillWorkingfromHomeStickinDevelopingEconomies? PreparedbyMarinaConesaMartinez,FutoshiNarita,andChrisPapageorgiou* AuthorizedfordistributionbyChrisPapageorgiouMay2023 IMFWorkingPapersdescriberesearchinprogressbytheauthor(s)andarepublishedtoelicitcommentsandtoencouragedebate.TheviewsexpressedinIMFWorkingPapersarethoseoftheauthor(s)anddonotnecessarilyrepresenttheviewsoftheIMF,itsExecutiveBoard,orIMFmanagement. ABSTRACT:Indevelopingeconomies,ashifttoworkingfromhomeduringtheCOVID-19pandemicvariessubstantially.Anincreaseinteleworkingdaysperweekrangesfrom0.7to17.6percentagepointsacross10developingcountriescoveredbyanonlinesurveytoabout500respondentspercountry.Anestimatedincomediscountassociatedwithteleworkdisappearedtemporarilyattheonsetofthepandemic.Acalibratedmodelindicatesthatworkers’preferencestoteleworkmaylargelydependontheireducationalattainments.Whetherteleworkwillsustaininthesecountriescoulddependonobstaclestotelework,particularlyforworkerswithlesseducation,andadegreeofeconomy-wideexternality. RECOMMENDEDCITATION:ConesaMartinez,Marina,FutoshiNarita,andChrisPapageorgiou.2023.“WillWorkingfromHomeStickinDevelopingEconomies.”IMFWorkingPaper23/XX. JELClassificationNumbers: E24,J22,O15,O33 Keywords: COVID-19;developingeconomies;externality;workingfromhome Author’sE-MailAddress: MConesaMartinez@imf.org;FNarita@imf.org;CPapageorgiou@imf.org *Acknowledgment:WethankNickBloom,MarinaMendesTavares,FerdinandoMonte,MachikoNarita,CarloPizzinelli,XinTang,andotherIMFcolleaguesfortheirhelpfulcomments.Thispaperispartofresearchprojectson“macroeconomicpolicyinlow-incomecountries”(IATIIdentifier:GB-1-202960)supportedbytheU.K.’sForeign,CommonwealthandDevelopmentOffice(FCDO)andthepartnersintheIMF’sCOVID-19CrisisCapacityDevelopmentInitiative(CCCDI)—Belgium,Canada,China,Germany,Japan,Korea,Spain,Singapore,andSwitzerland;andon“macroeconomicresearchonclimatechangeandemergingrisksinAsia”supportedbytheGovernmentofKorea.TheviewsexpressedhereinarethoseoftheauthorsandshouldnotbeattributedtotheIMF,itsExecutiveBoard,itsmanagement,orthesupportingpartners.Weareresponsibleforanyremainingerrors. WORKINGPAPERS WillWorkingfromHomeStickinDevelopingEconomies? PreparedbyMarinaConesaMartinez,FutoshiNarita,andChrisPapageorgiou1 1Acknowledgment:WethankNickBloom,MarinaMendesTavares,FerdinandoMonte,MachikoNarita,CarloPizzinelli,XinTang,andotherIMFcolleaguesfortheirhelpfulcomments.Thispaperispartofresearchprojectson“macroeconomicpolicyinlow-incomecountries”(IATIIdentifier:GB-1-202960)supportedbytheU.K.’sForeign,CommonwealthandDevelopmentOffice(FCDO)andthepartnersintheIMF’sCOVID-19CrisisCapacityDevelopmentInitiative(CCCDI)—Belgium,Canada,China,Germany,Japan,Korea,Spain,Singapore,andSwitzerland;andon“macroeconomicresearchonclimatechangeandemergingrisksinAsia”supportedbytheGovernmentofKorea.TheviewsexpressedhereinarethoseoftheauthorsandshouldnotbeattributedtotheIMF,itsExecutiveBoard,itsmanagement,orthesupportingpartners.Weareresponsibleforanyremainingerrors. Contents 1.Introduction3 2.Teleworkindevelopingeconomiesduringthepandemic5 Figure1.Cross-countrydifferenceinashifttoteleworkingattheonsetofthepandemic7 Figure2.Transitionacrossworkarrangementsindevelopingeconomiesuponthepandemic8 Figure3.Estimatedincomedifferentialsbyworkarrangement(percent)9 3.Preferencesorprofitability:Amodelofteleworkchoice10 Figure4.Preferenceshiftsimpliedbyteleworksharesandestimatedrelativeincome(percent)11 Figure5.ComparingBrazilandVietnamwithoutorwithexternality12 4.Conclusion13 AppendixA.Onlinesurveydetails14 AppendixTableA1.Demographicssummary—2ndroundonly15 AppendixTableA2.Incomesummary—2ndroundonly16 AppendixTableA3.Teleworkandpre-pandemicfundamentals—2ndroundonly17 AppendixFigureA1.Backgroundinformationonmainincomeearners—2ndroundonly18 AppendixFigureA2.Employmentstatusofmainincomeearners—2ndroundonly19 AppendixFigureA3.Teleworksituationsindevelopingcountries—2ndroundonly19 AppendixFigureA4.Teleworksituationsbyworker/householdcharacteristics—2ndroundonly20 AppendixFigureA5.Notonlyteleworkbutalsoparttimejobsincreasedduringthepandemic21 AppendixFigureA6.Teleworkshareandrecoveryinworkdaysfromthepandemic-relatedshocks22 AppendixFigureA7.ReflectionofCOVID-19infectionriskwhenchangingjobs,byeducation22 AppendixB.Characteristicsassociatedwithtelework23 AppendixTableB1.Teleworksharesandworkers’characteristics25 AppendixTableB2.Incomelevelsandworkers’characteristics26 AppendixTableB3.Estimatedincomedifferentialsbyworkarrangementandeducation27 AppendixTableB4.Severeincidentsrelatedtothepandemicandrespondent’scharacteristics28 AppendixC.Modeldetails