Self-employment, income, and poor with disabilities: the 2016 inclusion of people with disabilities act in Brazil

ABSTRACT

We exploit the implementation of the Inclusion of People with Disabilities Act in Brazil in early 2016 and use stigma theory to focus on the poor with disabilities, a double-stigmatized group, in a developing country setting. We hypothesize after the passage of the law, the poor with disabilities will pursue more self-employment than employment, but their income will remain low, with only the income of the employed improving. Contrary to expectations, the results show that the odds of self-employment were not higher than employment after the law. But as predicted, only the income of the employed improved, with the income gap between the employed and self-employed with disabilities growing wider after the passage of the law. The findings demonstrate that the law mainly benefitted the poor with disabilities who were able to gain employment but not the self-employed.

KEYWORDS:

• People with disabilities
• self-employment
• income
• Brazil
• law

JEL CLASSIFICATION:

• J11
• J14

Acknowledgments

We would like to thank the Ministério da Cidadania (Brazilian Ministry of Citizenship) and the Secretaria de Avaliação e Gestão da Informação (SAGI) (Secretariat of Assessment and Information Management) for allowing us access to the data of the Cadunico through a cooperation agreement. We would like to also thank Bruno Gondim Barbosa Duarte, Simone Antonia Colen, Francinete Nunes da Silva Sousa Lemos, and Otavio Luiz de Araujo for facilitating access to the data.

Disclosure statement

No potential conflict of interest was reported by the authors.

Supplementary material

Supplemental data for this article can be accessed online at https://doi.org/10.1080/00036846.2022.2130152.

Notes

¹ A full discussion of this bill is beyond the scope of this work. A full copy of the law is available at: https://www.un.org/development/desa/disabilities/wp-content/uploads/sites/15/2019/11/Brazil_Status-of-Persons-with-Disabilities.pdf.

² The data represents individuals participating in the Bolsa Familia program, a conditional cash transfer program, and should not be considered representative of the broader population. The higher prevalence rate (72.73%) for the sample is representative of sustenance-based entrepreneurship among the working poor in developing countries. We have made a note of this important point you made in the descriptives table.