Most countries implement social protection programs to help individuals manage income shocks and reduce poverty. Programs can be divided into two broad categories: social insurance and social assistance. Social insurance (SI) focuses on consumption smoothing. The most common programs include unemployment benefits, old-age, disability, and survivorship pensions, as well as health insurance. Social assistance (SA) programs focus on poverty prevention and mitigation. These usually take the form of in-cash or in-kind transfers allocated on the basis of means and/or individual characteristics (e.g., age, disability), and sometimes conditioned on behaviors (e.g., regular pre-natal checkups or public works). While few would argue against the need and social merits of these programs there are growing concerns about their unintended consequences on labor markets because of poor design. The programs can distort incentives and individual behaviors in ways that either reduce employment levels and/or promote informality, ultimately affecting productivity and economic performance. For instance, high social security contribution rates can reduce formal employment; badly designed unemployment benefits can reduce incentives to keep, search, and take jobs; and fragmented social assistance programs can become a tax on formal labor and encourage informality. This book reviews the evidence regarding the effects of SI and SA programs on labor market outcomes and discusses options to improve their design and implementation. The book focuses particularly on middle income countries in Latin America and Asia with a large informal sector. These economies are characterized by a huge informal sector (often bigger than the formal sector), where workers and firms operate, often voluntarily, outside of legal regulations, and labor market structures that are different from the US and Western Europe.