Working Paper 123 - Labor Market Dynamics in Tunisia: The Issue of Youth Unemployment

This paper analyzes the dynamics of the youth labor market in Tunisia using unique labor force survey data from 2005 to 2007 that include a longitudinal component. It first shows that sustained economic growth will reduce youth unemployment over the next few years. Second, forecasts indicate that the growth of private sector services has the highest potential to reduce youth unemployment. Third, the analysis of labor market characteristics reveals that young graduates experience long unemployment as they cue for high-skill jobs. Moreover, the public sector remains the main provider of employment opportunities for many graduates, in particular for women.

Labor Market Dynamics in Tunisia: The Issue of Youth Unemployment

This paper analyzes the dynamics of the youth labor market in Tunisia using unique labor force survey data from 2005 to 2007 that include a longitudinal component. It first shows that sustained economic growth will reduce youth unemployment over the next few years. Second, forecasts indicate that the growth of private sector services has the highest potential to reduce youth unemployment. Third, the analysis of labor market characteristics reveals that young graduates experience long unemployment as they cue for high-skill jobs. Moreover, the public sector remains the main provider of employment opportunities for many graduates, in particular for women.labor market, Tunisia, unemployment, youth

Working Paper 106 - Does Human Capital Protect Workers against Exogenous Shocks? South Africa in the 2008 - 2009 Crisis

The financial and economic crisis of 2008and 2009 has taken its toll on the SouthAfrican economy. The economy contractedfor the first time since 1998, and enteredrecession during the fourth quarter of 2008.The GDP contraction was soon transmittedto the labor market. Between the secondquarters of 2008 and 2009, employment fellby 3.8 percent. However, not all individualswere hit with the same intensity. Using laborforce survey data unique in the Africancontext, we find that human capital provideda buffer against the shock. After controllingfor observable characteristics, education andexperience showed the potential to entirelyoffset the effect of the recession on thelikelihood of employment. This has importantpolicy implications, as it strengthens thecase for strategic investments in humancapital, and helps identifying the unskilled asthose with the highest need for social safetynet interventions during the recession.

Working Paper 110 - Education and Employment in Malawi

This paper analyzes the relationship betweeneducation and employment in Malawi, usingdata from the 2004-05 Integrated HouseholdSurvey (IHS-2). For both men and women,education is the passport to formalemployment and leads to higher hourlyearnings. Within regular wage employment,secondary education is associated with a123 percent wage premium, and universityeducation with a 234 percent wage premium(relative to illiteracy). In both rural and urbanareas, income is positively correlated withspecialization in regular wage employment.For example, in urban areas 60 percent of thehouseholds who derive at least 75 percent oftheir income from regular wage employmentbelong to the highest quartile of the incomedistribution. This reflects the relative scarcityof human capital. Among prime age males(25 to 39 years old), only 10 percent havecompleted secondary education. For womenin the same age group, the situation is evenworse, with the rate of completion ofsecondary schooling as low as 3 percent.The analysis of school enrolment highlightsthat teenage women experience high dropoutrates, which prevent greater femaleenrollment in higher education, and thereforeconstrain future participation in the bestforms of employment.

Does Human Capital Protect Workers against Exogenous Shocks? South Africa in the 2008-2009 Crisis

The financial and economic crisis of 2008 and 2009 has taken its toll on the South African economy. The economy contracted for the first time since 1998, and entered recession during the fourth quarter of 2008. The GDP contraction was soon transmitted to the labor market. Between the second quarters of 2008 and 2009, employment fell by 3.8 percent. However, not all individuals were hit with the same intensity. Using labor force survey data unique in the African context, we find that human capital provided a buffer against the shock. After controlling for observable characteristics, education and experience showed the potential to entirely offset the effect of the recession on the likelihood of employment. This has important policy implications, as it strengthens the case for strategic investments in human capital, and helps identifying the unskilled as those with the highest need for social safety net interventions during the recession.labor markets, South Africa, financial crisis, human capital, business cycle, emerging economies

Joining Panel Data with Cross-Sections for Efficiency Gains: an Application to a Consumption Equation for Nicaragua

This paper explores how cross-sectional data can be exploited jointly with longitudinal data, in order to increase estimation effciency while properly tackling the potential bias due to unobserved individual characteristics. We propose an innovative procedure and we show its implementation by analysing the determinants of consumption in Nicaragua, based on data from three Living Standard Measurement Study surveys from 1993, 1998 and 2001. The last two rounds constitute an unbalanced longitudinal data set, while the first is a cross-section of di®erent households. Under the assumption that the relationship between observed and unobserved characteristics is homogenous across time, information from longitudinal is are used to clean the bias in the unpaired sample. In a second step, corrected unpaired observations are used jointly with panel data. This reduces the standard errors of the estimation coe±cients and might increase their significance as well, otherwise compromised by the limited variation provided by the short longitudinal data

How Large Is the Private Sector in Africa? Evidence from National Accounts and Labor Markets

In recent years, the private sector has been recognized as a key engine of Africa's economic development. Yet, the most simple and fundamental question remains unanswered: how large is the African private sector? We present novel estimates of the size of the private sector in 50 African countries derived from the analysis of national accounts and labor market data. Our results point to a relatively large size of the African private sector. National account data shows that this accounts for about 2/3 of total investments, 4/5 of total consumption and 3/4 of total credit. In relative terms, large private sector countries are concentrated in Western Africa (Cote d'Ivoire, Guinea, Niger, Senegal and Togo), Central Africa (Cameroun, Republic of Congo) and Eastern Africa (Kenya, Sudan, Uganda and Tanzania), with the addition of Mauritius. Countries with small private sectors include a sample of oil-exporters (Algeria, Angola, Equatorial Guinea, Libya and Nigeria), some of the poorest countries in the continent (Burundi, Burkina Faso, Guinea Bissau, Mali and Sao Tome e Principe), Zambia and Botswana. Over the last ten years, the size of the private sector has been contracting significantly in oil exporting countries, although the variation in its size does not appear to be significantly correlated with growth performance. Labor market data reinforces the idea of a large private sector, which provides about 90% of total employment opportunities. However, most of this labor is informal and characterized by low productivity: permanent wage jobs in the private sector account on average for only 10% of total employment (a share similar to that provided by public administration and state owned enterprises). South Africa is the notable exception, with formal wage employment in the private sector representing 46% of total employment. Finally, we find evidence of negative private sector earning premiums, suggesting that market distortions abound. These are likely to prevent the efficient allocation of human resources, and to reduce the overall productivity of the African economies.private sector size, private sector development, private consumption, private investment, national accounts, private sector employment, private sector earnings, labor markets, Africa

The Lure of Tequila and the Bestowing of Motherly Love: Does it Matter Whether Public Cash Transfers are Given to Women or Men? Evidence from the PROGRESA and PROCAMPO Programs in Rural Mexico

This paper aims at evaluating the impact of two different cash transfer programs in rural Mexico - Procampo and Progresa - on total consumption, food consumption and other outcomes like investment, schooling and health care. Progresa is targeted to women, while Procampo goes to farmers, mostly men and many of which are poor. We show that both programs boost consumption. However, they obtain this effect through different channels. Progresa is destined to consumption expenditure directly, while Procampo, which is paid to landholders, boosts investments and needs time to produce its benefits. Furthermore, we separate program from gender effects and show that cash transfer programs targeted to men are beneficial only when the recipients own means of production. This suggest that policy makers should take into account the relationship between gender and ownership of assets when designing poverty reduction programs.gender effect, program effect, rural poverty, Labor and Human Capital,