Description:
The informal sector is generally
believed to be more vulnerable to various risks due to
limited access to social insurance, but little empirical
evidence exists to support this statement. This paper
examines the relationship between informality and protection
from health risks in Yemen. The formal sector, when defined
based on pension coverage, largely overlaps with public
employment where the better educated, more experienced, and
better informed tend to work. The results indicate that,
even after accounting for socio-economic status, water
supply and quality conditions, risky behavior patterns, and
unobserved heterogeneity, formal sector households have
better accessibility and affordability to health service.
This may in part explain better health outcomes among formal
households, although large heterogeneity across regions
(urban/rural) exists. However, the role of the existing
health insurance is found to be unclear. The findings
reconfirm the importance of policies that promote universal
access to health service and a risk pooling avenue delinked
from employment types as well as healthy living conditions
and lifestyles.