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Participation and sector selection in Nicaragua

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Author Info

  • Dario Pozzoli

    (Department of Economics, Aarhus School of Business, Frichshuset, Hermodsvej 22 DK-8230, Aabyhoj, Denmark)

  • Marco Ranzani

    (Universita' Cattolica-Largo Gemelli, 1 20123, Milano, Italy)

Abstract

This paper investigates the structure of the labor market in Nicaragua and is aimed at understanding the determinants of the choice between a number of segments, namely inactivity, unemployment, agriculture, the formal and the informal sectors. In addition, a model with a separate participation equation is estimated: it allows us to understand that age mainly is a supply-side factor, while education is an important element determining employer's choices Information networks, captured by the presence of a household member working in the formal sector, and geographical barriers to mobility also play a leading role. Copyright © 2009 John Wiley & Sons, Ltd.

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File URL: http://hdl.handle.net/10.1002/jid.1599
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Article provided by John Wiley & Sons, Ltd. in its journal Journal of International Development.

Volume (Year): 22 (2010)
Issue (Month): 5 ()
Pages: 591-610

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Handle: RePEc:wly:jintdv:v:22:y:2010:i:5:p:591-610

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Web page: http://www3.interscience.wiley.com/journal/5102/home

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  1. Piore, Michael J, 1983. "Labor Market Segmentation: To What Paradigm Does It Belong?," American Economic Review, American Economic Association, vol. 73(2), pages 249-53, May.
  2. Hausman, Jerry A & Wise, David A, 1978. "A Conditional Probit Model for Qualitative Choice: Discrete Decisions Recognizing Interdependence and Heterogeneous Preferences," Econometrica, Econometric Society, vol. 46(2), pages 403-26, March.
  3. Michael J. Pisani & José A. Pagán, 2004. "Sectoral Selection and Informality: a Nicaraguan Case Study," Review of Development Economics, Wiley Blackwell, vol. 8(4), pages 541-556, November.
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