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Growth and Employment in the Dominican Republic: Options for a Job-Rich Growth

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  • Umidjon Abdullaev
  • Marcello Estevao
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    Abstract

    The Dominican Republic has posted high rates of output and productivity growth, but labor market indicators have remained weak during the past 20 years. This paper documents these trends, showing that the rapid productivity growth originates in a few sectors, while the bulk of job creation is concentrated elsewhere. The speed of job creation has not been enough to raise employment rates, and lackluster real earnings along with still-rampant labor market informality suggest that most of the new jobs are of low quality. Low real wages and low labor force participation suggest the need of raising market wages above fallback incomes to attract individuals to the labor force. For that, measures to improve education and reduce product market distortions would be helpful.

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    Bibliographic Info

    Paper provided by International Monetary Fund in its series IMF Working Papers with number 13/40.

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    Length: 25
    Date of creation: 08 Feb 2013
    Date of revision:
    Handle: RePEc:imf:imfwpa:13/40

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    Related research

    Keywords: Employment; Dominican Republic; Economic growth; Labor markets; Education; Labor productivity; Labor force participation; productivity growth; inclusive growth;

    This paper has been announced in the following NEP Reports:

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    1. David Card & Pablo Ibarrar�n & Ferdinando Regalia & David Rosas-Shady & Yuri Soares, 2011. "The Labor Market Impacts of Youth Training in the Dominican Republic," Journal of Labor Economics, University of Chicago Press, vol. 29(2), pages 267 - 300.
    2. Honorati, Maddalena & Mengistae, Taye, 2007. "Corruption, the business environment, and small business growth in India," Policy Research Working Paper Series 4338, The World Bank.
    3. Besley, Timothy J. & Burgess, Robin, 2002. "Can Labour Regulation Hinder Economic Performance? Evidence from India," CEPR Discussion Papers 3260, C.E.P.R. Discussion Papers.
    4. Belorgey, Nicolas & Lecat, Remy & Maury, Tristan-Pierre, 2006. "Determinants of productivity per employee: An empirical estimation using panel data," Economics Letters, Elsevier, vol. 91(2), pages 153-157, May.
    5. Christopher Gust & Jaime Marquez, 2002. "International comparisons of productivity growth: the role of information technology and regulatory practices," International Finance Discussion Papers 727, Board of Governors of the Federal Reserve System (U.S.).
    6. Pablo Ibarraran & David Rosas Shady, 2009. "Evaluating the impact of job training programmes in Latin America: evidence from IDB funded operations," Journal of Development Effectiveness, Taylor & Francis Journals, vol. 1(2), pages 195-216.
    7. Norman Loayza & Pablo Fajnzylber & César Calderón, 2004. "Economic Growth in Latin America and The Caribbean: Stylized Facts, Explanations, and Forecasts," Working Papers Central Bank of Chile 265, Central Bank of Chile.
    8. David H. Autor & William R. Kerr & Adriana D. Kugler, 2007. "Do Employment Protections Reduce Productivity? Evidence from U.S. States," NBER Working Papers 12860, National Bureau of Economic Research, Inc.
    9. Guillermo E. Perry & William F. Maloney & Omar S. Arias & Pablo Fajnzylber & Andrew D. Mason & Jaime Saavedra-Chanduvi, 2007. "Informality : Exit and Exclusion," World Bank Publications, The World Bank, number 6730, March.
    10. Kaplan, David S., 2008. "Job creation and labor reform in Latin America," Policy Research Working Paper Series 4708, The World Bank.
    11. McKenzie, David & Woodruff, Christopher, 2012. "What are we learning from business training and entrepreneurship evaluations around the developing world ?," Policy Research Working Paper Series 6202, The World Bank.
    12. Kluve, Jochen, 2010. "The effectiveness of European active labor market programs," Labour Economics, Elsevier, vol. 17(6), pages 904-918, December.
    13. David H. Autor & William R. Kerr & Adriana D. Kugler, 2007. "Does Employment Protection Reduce Productivity? Evidence From US States," Economic Journal, Royal Economic Society, vol. 117(521), pages 189-217, 06.
    14. Richard Adams, 2011. "Evaluating the Economic Impact of International Remittances On Developing Countries Using Household Surveys: A Literature Review," Journal of Development Studies, Taylor & Francis Journals, vol. 47(6), pages 809-828.
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