Labor Market Transitions in Peru

Traditional labor market analysis based solely on the net unemployment rate fails to explain the apparent paradox between a relatively moderate unemployment rate in Peru (around 10%, with a weak sensibility to wide macroeconomic fluctuations), and the fact that unemployment is one of the major issues in Peru. One possible explanation is that this static indicator of cross section net unemployment balance is compatible with high flows in and out of employment states. To address these issues we needed to conduct a dynamic analysis using panel data. Using the Peruvian national household survey (ENAHO), we constructed a panel of working age individuals at the national level for the period 1997-1999. Like previous work in developing countries, we found that there is an important degree of job mobility in Peru. We also found that most of the transitions occur between employment and inactivity instead of between employment and unemployment. We also showed that the rate of permanent unemployment is very low so that unemployment would be essentially a frictional phenomenon. Further, considering the different transition states, we elaborated an unconditional transition profile, including individual and household characteristics, like gender, age and education levels for example, associated with each transition status. Finally, after examining these labor market transitions and the possible sample selection bias, we estimated a multinomial logit model. This model allowed us to appreciate the (conditional) incidence of individual and household characteristics as well as the effects of different shocks on the labor transition states.

Labor Market Transitions in Peru

Les analyses traditionnelles du marché du travail s’avèrent incapables d’expliquer le paradoxe apparent entre un taux de chômage relativement modéré dans un pays tel que le Pérou (environ 10%, taux peu sensible aux fortes fluctuations macro-économiques) et la perception d’une grave crise de l’emploi. Une explication possible pourrait résider dans le fait que cet indicateur statique en coupe instantanée ne mesure pas les flux élevés entre les situations d’emploi et d’inemploi. Pour analyser ces questions, il est nécessaire de conduire une analyse dynamique sur données de panel. Nous avons ainsi construit un panel national d’individus en âge de travailler pour la période 1997-1999 à partir de l’enquête péruvienne auprès des ménages (ENAHO). Comme d’autres études réalisées dans des pays en développement, nous constatons qu’il existe une importante mobilité de l’emploi au Pérou. Nous trouvons également que la plupart des transitions interviennent entre emploi et inactivité plutôt qu’entre emploi et chômage. Le taux de chômage permanent apparaît très faible et le chômage serait donc essentiellement un phénomène frictionnel. Pour aller plus loin, nous avons élaborés des profils de transition inconditionnels, incluant les caractéristiques individuelles et du ménage, telles que le genre, l’âge, et le niveau d’éducation, associé avec chaque état de transition. Finalement, après avoir examiné ces transitions sur le marché du travail et les biais de sélection possibles, nous avons estimé un modèle logit multinomial. Ce modèle nous a permis d’apprécier l’incidence (conditionnelle) des caractéristiques individuelles et des ménages ainsi que des différents chocs sur les états de transition en matière d’emploi.Traditional labor market analysis based solely on the net unemployment rate fails to explain the apparent paradox between a relatively moderate unemployment rate in Peru (around 10%, with a weak sensibility to wide macroeconomic fluctuations), and the fact that unemployment is one of the major issues in Peru. One possible explanation is that this static indicator of cross section net unemployment balance is compatible with high flows in and out of employment states. To address these issues we needed to conduct a dynamic analysis using panel data. Using the Peruvian national household survey (ENAHO), we constructed a panel of working age individuals at the national level for the period 1997-1999. Like previous work in developing countries, we found that there is an important degree of job mobility in Peru. We also found that most of the transitions occur between employment and inactivity instead of between employment and unemployment. We also showed that the rate of permanent unemployment is very low so that unemployment would be essentially a frictional phenomenon. Further, considering the different transition states, we elaborated an unconditional transition profile, including individual and household characteristics, like gender, age and education levels for example, associated with each transition status. Finally, after examining these labor market transitions and the possible sample selection bias, we estimated a multinomial logit model. This model allowed us to appreciate the (conditional) incidence of individual and household characteristics as well as the effects of different shocks on the labor transition states.ou

Labor Market Transitions in Peru

(english) Traditional labor market analysis based solely on the net unemployment rate fails to explain the apparent paradox between a relatively moderate unemployment rate in Peru (around 10%, with a weak sensibility to wide macroeconomic fluctuations), and the fact that unemployment is one of the major issues in Peru. One possible explanation is that this static indicator of cross section net unemployment balance is compatible with high flows in and out of employment states. To address these issues we needed to conduct a dynamic analysis using panel data. Using the Peruvian national household survey (ENAHO), we constructed a panel of working age individuals at the national level for the period 1997-1999. Like previous work in developing countries, we found that there is an important degree of job mobility in Peru. We also found that most of the transitions occur between employment and inactivity instead of between employment and unemployment. We also showed that the rate of permanent unemployment is very low so that unemployment would be essentially a frictional phenomenon. Further, considering the different transition states, we elaborated an unconditional transition profile, including individual and household characteristics, like gender, age and education levels for example, associated with each transition status. Finally, after examining these labor market transitions and the possible sample selection bias, we estimated a multinomial logit model. This model allowed us to appreciate the (conditional) incidence of individual and household characteristics as well as the effects of different shocks on the labor transition states. _________________________________ (français) Les analyses traditionnelles du marché du travail s’avèrent incapables d’expliquer le paradoxe apparent entre un taux de chômage relativement modéré dans un pays tel que le Pérou (environ 10%, taux peu sensible aux fortes fluctuations macro-économiques) et la perception d’une grave crise de l’emploi. Une explication possible pourrait résider dans le fait que cet indicateur statique en coupe instantanée ne mesure pas les flux élevés entre les situations d’emploi et d’inemploi. Pour analyser ces questions, il est nécessaire de conduire une analyse dynamique sur données de panel. Nous avons ainsi construit un panel national d’individus en âge de travailler pour la période 1997-1999 à partir de l’enquête péruvienne auprès des ménages (ENAHO). Comme d’autres études réalisées dans des pays en développement, nous constatons qu’il existe une importante mobilité de l’emploi au Pérou. Nous trouvons également que la plupart des transitions interviennent entre emploi et inactivité plutôt qu’entre emploi et chômage. Le taux de chômage permanent apparaît très faible et le chômage serait donc essentiellement un phénomène frictionnel. Pour aller plus loin, nous avons élaborés des profils de transition inconditionnels, incluant les caractéristiques individuelles et du ménage, telles que le genre, l’âge, et le niveau d’éducation, associé avec chaque état de transition. Finalement, après avoir examiné ces transitions sur le marché du travail et les biais de sélection possibles, nous avons estimé un modèle logit multinomial. Ce modèle nous a permis d’apprécier l’incidence (conditionnelle) des caractéristiques individuelles et des ménages ainsi que des différents chocs sur les états de transition en matière d’emploi.

Inégalités des chances sur le marché du travail : effets de l’origine sociale sur la mobilité professionnelle à Lima

Peruvian society is characterized by a highly unequal income distribution. But is it also an unfair society in terms of the equal-opportunity criterion ? Several studies have shown that social origin does not necessarily have a decreasing effect during the life cycle. For example , social origin can continue to influence a working career even after influencing education and the first job. The authors seek to answer this question by analyzing the effect of social origin on occupational mobility in Peru. They attempt to measure the impact of social background on occupational mobility after controlling for its effect on the prior stages of the life cycle.La société péruvienne, caractérisée par une répartition très inégalitaire des revenus, est-elle également une société injuste au regard du critère d’égalité des chances ? L’article s’interroge sur le rôle de l’origine sociale sur la mobilité occupationnelle des individus au cours de 5 ans de carrière. En effet, différents travaux suggèrent que l’origine sociale n’a pas un effet forcement décroissant au cours du cycle de vie et qu’elle peut continuer à influencer le déroulement de la carrière professionnelle, même après qu’elle ait exercé une influence sur l’éducation et le premier emploi. L’article cherche à tester si l’origine sociale est déterminante dans l’évolution de la carrière, même après avoir contrôlé ses effets sur les étapes antérieures du cycle de vie.Shady Gerardo David Rosas, Pasquier-Doumer Laure. Inégalités des chances sur le marché du travail : effets de l’origine sociale sur la mobilité professionnelle à Lima . In: Économie & prévision, n°186, 2008-5. Économie du développement et de la transition, sous la direction de Pierre Malgrange et Patrick Plane. pp. 67-87

Global economic burden of unmet surgical need for appendicitis

Background There is a substantial gap in provision of adequate surgical care in many low- and middle-income countries. This study aimed to identify the economic burden of unmet surgical need for the common condition of appendicitis. Methods Data on the incidence of appendicitis from 170 countries and two different approaches were used to estimate numbers of patients who do not receive surgery: as a fixed proportion of the total unmet surgical need per country (approach 1); and based on country income status (approach 2). Indirect costs with current levels of access and local quality, and those if quality were at the standards of high-income countries, were estimated. A human capital approach was applied, focusing on the economic burden resulting from premature death and absenteeism. Results Excess mortality was 4185 per 100 000 cases of appendicitis using approach 1 and 3448 per 100 000 using approach 2. The economic burden of continuing current levels of access and local quality was US $92 492 million using approach 1 and$73 141 million using approach 2. The economic burden of not providing surgical care to the standards of high-income countries was $95 004 million using approach 1 and$75 666 million using approach 2. The largest share of these costs resulted from premature death (97.7 per cent) and lack of access (97.0 per cent) in contrast to lack of quality. Conclusion For a comparatively non-complex emergency condition such as appendicitis, increasing access to care should be prioritized. Although improving quality of care should not be neglected, increasing provision of care at current standards could reduce societal costs substantially

Global economic burden of unmet surgical need for appendicitis

Background There is a substantial gap in provision of adequate surgical care in many low- and middle-income countries. This study aimed to identify the economic burden of unmet surgical need for the common condition of appendicitis. Methods Data on the incidence of appendicitis from 170 countries and two different approaches were used to estimate numbers of patients who do not receive surgery: as a fixed proportion of the total unmet surgical need per country (approach 1); and based on country income status (approach 2). Indirect costs with current levels of access and local quality, and those if quality were at the standards of high-income countries, were estimated. A human capital approach was applied, focusing on the economic burden resulting from premature death and absenteeism. Results Excess mortality was 4185 per 100 000 cases of appendicitis using approach 1 and 3448 per 100 000 using approach 2. The economic burden of continuing current levels of access and local quality was US $92 492 million using approach 1 and$73 141 million using approach 2. The economic burden of not providing surgical care to the standards of high-income countries was $95 004 million using approach 1 and$75 666 million using approach 2. The largest share of these costs resulted from premature death (97.7 per cent) and lack of access (97.0 per cent) in contrast to lack of quality. Conclusion For a comparatively non-complex emergency condition such as appendicitis, increasing access to care should be prioritized. Although improving quality of care should not be neglected, increasing provision of care at current standards could reduce societal costs substantially