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Understanding the Impact of Economic Shocks on Labor Market Outcomes in Developing Countries : An application to Indonesia and Mexico

Gutierrez, Catalina; Paci, Pierella; Park, Beom S.
Fonte: Banco Mundial Publicador: Banco Mundial
Relevância na Pesquisa
76.26%
In this paper the authors use a search and matching model of multi-sector labor markets, to understand the channels through which economic shocks affect labor market outcomes in developing countries. In the model workers can be employed in agriculture, formal or informal urban jobs, or unemployed. Economic shocks are manifested as either increased turbulence in the formal/informal sectors or a decrease in overall sectoral productivity. By calibrating the model to Indonesia and Mexico, the authors are able to understand how the 1998 Indonesian crisis and the 2001 Mexican recession translated into labor market outcomes. They then venture to simulate how the current financial crisis might affect the allocation of labor and earnings across sectors, in these countries. The results suggest that in both countries past crises have increased the degree of turbulence of the formal sector, increasing job destruction. However, while in Indonesia the crisis affected the overall formal sector productivity, this was not the case in Mexico. This explains the larger blow to formal wages -- relative to the size of the shock- witnessed by Indonesian workers. The response of the informal sector was also different: In both countries the informal sector was able to act as a buffer...

The Mauritanian labor market through the lens of the 2004 national household survey

Rajadel, Tania; Pontara, Nicola; Sanchez Puerta, Maria Laura
Fonte: Banco Mundial Publicador: Banco Mundial
Relevância na Pesquisa
76.46%
This paper provides a snapshot of Mauritania s labor market using data from the 2004 national household survey. The results show that the labor market is characterized by lower participation rates, lower employment-to-population rates, and relatively higher unemployment rates than in neighboring countries. The non poor fare better in the labor market than the poor. Although the labor force participation of the poor is higher than that of the non poor, the poor display a higher unemployment rate and a lower employment rate than the non poor. The data also suggest a negative correlation between wage employment and poverty. Substantial differences in labor market indicators emerge when disaggregating the analysis by gender and age-group. Female non-participation is extremely high. Women systematically earn less than men independently of their sector and type of employment and controlling for other factors, such as education. Young adults face considerable difficulties in entering the labor market: more than half of the population aged 15-24 is neither studying nor participating in the labor force. As gender disparities remain important for similar levels of education...

Linking Education Policy to Labor Market Outcomes

Fasih, Tazeen
Fonte: Washington, DC: World Bank Publicador: Washington, DC: World Bank
EN_US
Relevância na Pesquisa
76.47%
Education plays a central role in preparing individuals to enter the labor force, as well as equipping them with the skills to engage in lifelong learning experiences. The objective of this study is to review what is known about the role of education in improving labor market outcomes, with a particular focus on policy considerations for developing countries. The report presents findings from current literature on the topic, which offers new ways of looking at the returns to education, together with evidence from four original data analysis and background studies of education and labor issues in Ghana and Pakistan. Country studies on Ghana and Pakistan are used to substantiate findings of the literature and illustrate the heterogeneity of education labor market linkages across regions. These countries were chosen because they are representative of two of the poorest regions of the world and because their inclusion in the analysis complements ongoing World Bank work on education and labor market issues in those countries. This report offers two types of findings: those relevant to the content of educational policies and those relevant to the framework for educational policy making.

Assessing Interactions among Education, Social Insurance, and Labor Market Policies in a General Equilibrium Framework : An Application to Morocco

Marouani, Mohamed A.; Robalino, David A.
Fonte: World Bank, Washington, DC Publicador: World Bank, Washington, DC
Relevância na Pesquisa
76.37%
This paper develops a general equilibrium model to analyze the marginal and joint impacts that alternative macroeconomic, education, and social protection policies have on the dynamics of employment and unemployment by skill level. The model introduces a disaggregated treatment of the labor market that incorporates an informal sub-sector in every sector of the economy. The analysis explicitly models the distribution of skills in the labor force by following over time sex-age cohorts across various levels of the education system and in the labor market. And it integrates a module that projects the revenues and expenditures of the pension system. The model is applied to the case of Morocco. Simulations show that even under positive assumptions regarding economic growth, unemployment rates are likely to remain close to current levels in the next decade. The paper argues that only an integrated package of policies that affect the macro-economy, the investment climate, and the education and social protection systems would allow sustainable creation of enough "good quality" jobs.

Institutions and Labor Market Outcomes in Sub-Saharan Africa

Fox, Louise; Oviedo, Ana Maria
Fonte: World Bank, Washington, DC Publicador: World Bank, Washington, DC
Relevância na Pesquisa
76.27%
The authors use firm-level survey data from the manufacturing sector in 20 Sub-Saharan African countries to explore the links between labor market regulations and net job creation. A first look at firm characteristics, perceptions, and the dynamics of employment at the firm level suggests that labor regulations are not the main "binding constraint" on job creation. Other issues seem more important at this level of development. The analysis estimates the determinants of net job creation incorporating the legal origin of the country as a proxy for regulation. The findings show that, after controlling for other firm-level characteristics, legal origin is uncorrelated with net job creation in the short run.

Labor Market Policy in Developing Countries : A Selective Review of the Literature and Needs for the Future

Fields, Gary S.
Fonte: World Bank, Washington, DC Publicador: World Bank, Washington, DC
Relevância na Pesquisa
96.5%
This paper presents a selective overview of the literature on modeling labor market policies in developing countries. It considers welfare economics, theoretical models, and empirical evidence to highlight the three general features needed in future research on labor market policy in developing countries. The author identifies desirable research components (welfare economics, theoretical modeling, and empirical modeling) and pitfalls in the literature (inappropriate use of productivity, reliance on wrong kinds of empirical studies, lack of cost-benefit analysis, attention to only a subset of the goods and bads, and fallacy of composition). The paper concludes with suggested topics and methods for future research. The author states that sound labor market policy requires sound labor market models. The paper makes a case for developing policy based on explicit evaluation criteria, specific theoretical models, and comprehensive empirical evidence.

Armenia - Labor Market Dynamics : Volume 1. Overview

World Bank
Fonte: Washington, DC Publicador: Washington, DC
Relevância na Pesquisa
76.45%
This study is intended to help Armenian policymakers better understand the main factors behind modest labor market outcomes and to identify policy options to create more and better jobs. The report is based on data from administrative statistics, labor force surveys, and household surveys. The objective of the study is to determine the main factors behind poor labor market outcomes in Armenia: high unemployment of long duration despite rapid economic growth. To do so, it will assess, first, the key characteristics of the demand for labor. These include (a) the impact of macroeconomic policies on job growth; (b) wage flexibility and unit labor costs; (c) cost-of-doing-business factors, including costs, risks, and barriers to competition faced by firms; and (d) employment promotion legislation and labor market institutions. Recommendations are made on policies that can promote an effective and sustainable increased demand for labor; second, the key characteristics of the supply of labor, including the impact of long-term demographic developments and labor migration...

Regional Labor Market Developments in Transition

Huber, Peter
Fonte: World Bank, Washington, DC Publicador: World Bank, Washington, DC
Relevância na Pesquisa
86.41%
The author analyzes regional labor market disparities in transition by presenting some data and summarizing existing literature. He finds that large and persistent regional labor market disparities developed in virtually all transition countries and that there is some evidence of polarization. Differences in starting conditions and market access seem to be the major reasons for regional divergence in transition. Furthermore, regional wages are only slightly more flexible than in many European Union labor markets, interregional migration is low, and capital seems to move toward high wage and low unemployment urban centers rather than to the most backward regions. Policy should thus take a long-run perspective on the existing regional disparities, focus on removing barriers to mobility, review existing institutions for implementing regional policy, and aim at a close coordination of regional and labor market policy instruments.

The Roles of Openness and Labor Market Institutions for Employment Dynamics during Economic Crises

Gamberoni, Elisa; Uexkull, Erik Von; Weber, Sebastian
Fonte: World Bank, Washington, DC Publicador: World Bank, Washington, DC
Relevância na Pesquisa
76.34%
Employment effects of the recent global economic crisis have differed significantly across countries. An active public debate currently focuses on external shocks and the role of labor market policies as a driver of those differences. In this note, the authors analyze the roles of integration into the global economy and different labor market institutions during different phases of past global economic downturns and domestic banking and debt crises. The authors find that domestic debt and banking crises were much more severe in their impact on employment than were global economic downturns: on average, the reduction in employment growth was more than twice as strong. The authors also find that openness to trade has both deepened the contractionary effects on employment and allowed for a faster recovery. High severance pay dampened the employment effect in both domestic crises and global economic downturns, whereas very high unemployment benefits were associated with stronger reductions in employment growth.

The Labor Market Policy Reform Agenda in MENA

World Bank
Fonte: World Bank, Washington, DC Publicador: World Bank, Washington, DC
Relevância na Pesquisa
86.45%
Despite positive economic growth in recent years, basic labor market outcomes in the Middle East and North Africa (MENA) remained stagnant and have only improved slightly in the past 10 years. A number of recent and ongoing analyses have stressed the pressing need for many economies in the region to identify new and sustainable sources of growth, create more and higher value-added employment, and absorb the fast growing number of university graduates into the labor market. Structural transformation towards higher productivity and the creation of qualified jobs requires far reaching reforms in multiple sectors, including innovation, science and technology; education quality; labor market flexibility and mobility; and entrepreneurial incentives allowing investors to innovate, invest, and create higher value added jobs. Within this broad context, this note focuses on labor market policies and the agenda for labor market reform in MENA.

Who Benefits from Labor Market Regulations? Chile 1960-1998

Montenegro, Claudio E.; Pagés, Carmen
Fonte: World Bank, Washington, DC Publicador: World Bank, Washington, DC
EN_US
Relevância na Pesquisa
76.34%
Economists have examined the impact of labor market regulations on the level of employment. But there are many reasons to suspect that the impact of regulations differs across types of workers. In this paper the authors take advantage of the unusually large variance in labor policy in Chile to examine how different labor market regulations affect the distribution of employment and the employment rates across age, gender, and skill levels. To this effect, they use a sample of repeated cross-section household surveys spanning the period 1960-98 and measures of the evolution of job security provisions and minimum wages across time. The results suggest large distribution effects. The authors find that employment security provisions and minimum wages reduce the share of youth and unskilled employment as well as their employment rates. They also find large effects on the distribution of employment between women and men.

Labor Market Policies and Unemployment in Morocco : A Quantitative Analysis

Agenor, Pierre-Richard; El Aynaoui, Karim
Fonte: World Bank, Washington, DC Publicador: World Bank, Washington, DC
EN_US
Relevância na Pesquisa
76.4%
The authors study the impact of labor market policies on unemployment in Morocco. They begin by reviewing the main features of the labor market. Then they present a quantitative framework that captures many of these features-such as a large public sector, high redundancy payments, powerful trade unions, and international labor migration. The authors simulate the impact of a cut in the minimum wage and a reduction in payroll taxation. The results indicate that these policies may have a significant impact in the short term on open unskilled unemployment. But they also show that labor market reforms, to be effective in the long run, may need to be accompanied by offsetting changes in the budget to avoid crowding-out effects on private investment.

Sticky Feet : How Labor Market Frictions Shape the Impact of International Trade on Jobs and Wages

Hollweg, Claire H.; Lederman, Daniel; Rojas, Diego; Ruppert Bulmer, Elizabeth
Fonte: Washington, DC: World Bank Publicador: Washington, DC: World Bank
EN_US
Relevância na Pesquisa
76.45%
This report analyzes the paths by which developing country labor markets adjust to permanent trade-related shocks. Trade shocks can bring about reallocation of labor between industries, but the presence of labor mobility costs implies economy-wide losses because they extend the period of economic adjustment. This report focuses primarily on the adjustment costs faced by workers after a trade shock, because of magnitude and welfare implications and policy relevance. From a policy viewpoint, understanding the relative magnitudes of labor mobility and adjustment costs can help policymakers design trade policies that are consistent with employment objectives, can be complemented by labor policies, or support programs to facilitate labor transitions, or both. To complement and validate the analysis based on structural choice models, the study designed a distinct empirical approach using reduced-form econometric estimation strategies. This approach examines the impact of structural reforms and worker displacement on labor market outcomes. This makes it possible to estimate the time required to adjust to a trade-related shock...

Portraits of Labor Market Exclusion

Sundaram, Ramya; Hoerning, Ulrich; De Andrade Falcao, Natasha; Millan, Natalia; Tokman, Carla; Zini, Michele
Fonte: Washington, DC: World Bank Publicador: Washington, DC: World Bank
EN_US
Relevância na Pesquisa
76.44%
The financial crisis that hit the global market in the middle of 2008 gave way to the sharpest contraction of the European economies since the Great Depression. In 2009 the economic output in the countries of the European Union shrank 4.5 percent, the largest reduction in GDP since its creation. Since then, the economies have slowly recovered, but unemployment has continued to rise, reaching 11 percent in 2013, up from 7.1 percent in 2008. The economy of the European Union shrank 4.5 percent, the largest reduction in its GDP since the Union s creation. Furthermore, for the European Union as a whole, long-term unemployment among 15- to 64-year-olds has increased from 37.2 percent in 2008 to 47.5 percent of total unemployment in 2013. In several countries more than half of those unemployed are long-term unemployed, that is, they have been looking for jobs for more than 12 months. In Greece and Bulgaria the share of long-term unemployed in 2013 was 67.5 percent and 57.3 percent, respectively. Youth unemployment, on the other hand...

Labor Policy to Promote Good Jobs in Tunisia : Revisiting Labor Regulation, Social Security, and Active Labor Market Programs

Angel-Urdinola, Diego F.; Nucifora, Antonio; Robalino, David
Fonte: Washington, DC: World Bank Publicador: Washington, DC: World Bank
EN_US
Relevância na Pesquisa
76.48%
Tunisians are striving for the opportunity to realize their potential and aspirations in a country that is rich in both human and physical capital, but whose recent economic growth has failed to create enough opportunities in the form of good and productive jobs. This report highlights the main barriers that hinder the Tunisian labor market from providing income, protection, and prosperity to its citizens and proposes a set of labor policies that could facilitate the creation of better, more inclusive, and more productive jobs. The weak economic performance and insufficient and low-quality job creation in Tunisia is primarily the result of an economic environment permeated by distortions, barriers to competition, and excessive red tape, including in the labor market. This has resulted in the creation of a insufficient number of jobs, especially in the formal sector. To change this situation, policy makers need to address five strategic directives that can promote long-term inclusive growth and formality: foster competition; realign incentives...

Labor Market Regulations and Outcomes in Sweden

Ulku, Hulya; Muzi, Silvia
Fonte: World Bank, Washington, DC Publicador: World Bank, Washington, DC
Tipo: Trabalho em Andamento
EN_US
Relevância na Pesquisa
76.38%
This paper analyzes recent trends in Swedens labor market regulations in relation to comparator economies and examines the relationship between labor market regulations and outcomes. The paper finds that the Swedish labor market responded more rapidly to the recent global financial crisis than the majority of the European Union economies, which helped Sweden to recover quickly. Swedens hiring regulations are more flexible than those of many comparator economies, however, fixed-term contracts of short duration might have adverse consequences for the economy. In addition, Swedens regulations on work during the weekly holidays and mandatory paid annual leave are stricter than those of the majority of comparator economies. Moreover, among the economies of the Organisation for Economic Co-operation and Development, Sweden has one of the largest differences in employment protection between permanent and temporary employees, which could lead to a segmented labor market, where insiders enjoy high job security and outsiders are largely marginalized. This could be cause for concern...

The Impact of Syrians Refugees on the Turkish Labor Market

Del Carpio, Ximena V.; Wagner, Mathis
Fonte: World Bank, Washington, DC Publicador: World Bank, Washington, DC
Tipo: Trabalho em Andamento
EN_US
Relevância na Pesquisa
76.41%
Civil war in Syria has resulted in more than four million refugees fleeing the country, of which 1.8 million have found refuge in Turkey, making it the largest refugee-hosting country worldwide. This paper combines newly available data on the 2014 distribution of Syrian refugees across subregions of Turkey with the Turkish Labour Force Survey, to assess the impact on Turkish labor market conditions. Using a novel instrument, the analysis finds that the refugees, who overwhelmingly do not have work permits, result in the large-scale displacement of informal, low-educated, female Turkish workers, especially in agriculture. While there is net displacement, the inflow of refugees also creates higher-wage formal jobs, allowing for occupational upgrading of Turkish workers. Average Turkish wages have increased primarily as the composition of the employed has changed because of the inflow of refugees.

Poland : Labor Market Study--The Challenges of Job Creation

World Bank
Fonte: Washington, DC Publicador: Washington, DC
ENGLISH; EN_US
Relevância na Pesquisa
76.45%
The study reviews recent labor market developments in Poland, examining the factors behind the rise in unemployment, and, proposing actions that should contribute to increased job creation rates. Its main purpose is to inform - based on research findings - on the policy dialogue regarding the current labor market situation in the country. Those main findings indicate that the rise in unemployment results primarily from an acceleration of job destruction, that begun with the wave of enterprise restructuring in the aftermath of the Russia crisis, and has persisted in part, because of an imbalance in the fiscal-monetary policy mix. It also finds that the recent rise in unemployment has highlighted important barriers in the transition from old, to new jobs. These barriers include a binding minimum wage, high taxes on labor income, limitations in the labor code, and a relatively easy access to early retirement, and other social benefits. Additionally, the problems with the ongoing restructuring of the Polish labor market have been compounded by an increase in new labor market entrants...

The Russian Labor Market : Moving from Crisis to Recovery

World Bank
Fonte: Moscow: Izdatelstvo Ves Mir and the World Bank Publicador: Moscow: Izdatelstvo Ves Mir and the World Bank
Tipo: Publications & Research :: Publication; Publications & Research :: Publication
ENGLISH; EN_US
Relevância na Pesquisa
76.33%
This report suggests measures to help Russia develop a formal, competitive labor market over the medium term. The study addresses four major questions: (1) How well has Russia been able to redress the misallocation of labor inherited from its socialist past? (2) Do wages increasingly reflect market forces? (3) Are labor market institutions consistent with those required in a market economy? (4) How well has Russia been able to reduce explicit protection offered by firms and create an effective safety net? The report addresses each question in a separate chapter and also highlights key issues and policy options in each area. The development of a well functioning labor market will contribute to Russia's ability to integrate with the global economy, particularly as it faces the opportunity and challenges that will come with World Trade Organization accession.

Regional Disparities in Labor Market Performance in Croatia : The Role of Individual and Regional Structural Characteristics

Luo, Xubei
Fonte: World Bank, Washington, DC Publicador: World Bank, Washington, DC
Tipo: Publications & Research :: Policy Research Working Paper; Publications & Research
ENGLISH
Relevância na Pesquisa
86.43%
The labor market performance in Croatia failed to keep pace with the moderately good overall macroeconomic development in the past few years. Youth, the less well-educated, and women face more difficulties in getting a job with a decent salary. A large part of the difference in regional labor market performance is associated with the difference in the human capital endowment. With a stagnant total employment rate, the large disparities in employment and earnings across individual groups and regions have become one of the concerns for the long-term sustainable development of the economy. Using Labor Force Survey (LFS) data from 2002-04, this paper studies the labor market performance in Croatia at the national and regional levels. The results show that both one's individual characteristics (including age, education and gender) and where he or she works plays a role in his or her employment and earnings. Regional differences in employment and earnings are reduced to a large extent when accounting for differences in individual characteristics. The simulations shed light on the effectiveness of the nationwide education policy and regional specific labor market policy...