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Allocation of Labour in Urban West Africa: Implication for Development Policies

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Author Info

  • Dimova, Ralitza

    ()
    (University of Manchester)

  • Nordman, Christophe Jalil

    ()
    (IRD, DIAL, Paris)

  • Roubaud, François

    ()
    (IRD, DIAL, Paris)

Abstract

With the use of comparable data from seven West African capitals, we attempt to assess the rationale behind development policies targeting high rates of school enrolment through the prism of allocation of labour and returns to skills across the formal and informal sectors. We find that people with high levels of education allocate to the small formal sector and receive high compensation for their education and experience. Less educated workers allocate to the informal sector. While self-employment reveals some characteristics of a sector of dynamic entrepreneurship, the characteristics of the informal salaried sector are closer to those of a sector of hidden unemployment, or a stepping stone for better jobs in the future.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 3558.

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Length: 37 pages
Date of creation: Jun 2008
Date of revision:
Publication status: published as 'Allocation of Labor in Urban West Africa: Insights from the Pattern of Labor Supply and Skill Premiums' in: Review of Development Economics, 2010, 14 (1), 75 - 92
Handle: RePEc:iza:izadps:dp3558

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Related research

Keywords: Sub-Saharan West Africa; returns to skills; allocation of labour; self-selection; informal sector;

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References

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  1. Maloney, William, 2003. "Informality revisited," Policy Research Working Paper Series 2965, The World Bank.
  2. T. Paul Schultz, 2003. "Evidence of Returns to Schooling in Africa from Household Surveys: Monitoring and Restructuring the Market for Education," Working Papers, Economic Growth Center, Yale University 875, Economic Growth Center, Yale University.
  3. Dimova, Ralitza & Gang, Ira N., 2007. "Self-selection and wages during volatile transition," Journal of Comparative Economics, Elsevier, vol. 35(3), pages 612-629, September.
  4. Psacharopoulos, George & Patrinos, Harry Anthony, 2002. "Returns to investment in education : a further update," Policy Research Working Paper Series 2881, The World Bank.
  5. V. Kerry Smith & Mary F. Evans & Hyun Kim & Donald H. Taylor, 2004. "Do the Near-Elderly Value Mortality Risks Differently?," The Review of Economics and Statistics, MIT Press, vol. 86(1), pages 423-429, February.
  6. Earle, John S. & Sakova, Zuzana, 2000. "Business start-ups or disguised unemployment? Evidence on the character of self-employment from transition economies," Labour Economics, Elsevier, Elsevier, vol. 7(5), pages 575-601, September.
  7. Pieter Serneels, 2004. "The Nature of Unemployment in Urban Ethiopia," Economics Series Working Papers WPS/2004-01, University of Oxford, Department of Economics.
  8. Måns Söderbom & Francis Teal & Anthony Wambugu & Godius Kahyarara, 2004. "The Dynamics of Returns to Education in Kenyan and Tanzanian Manufacturing," Development and Comp Systems 0409041, EconWPA.
  9. Kuépié, Mathias & Nordman, Christophe Jalil & Roubaud, François, 2006. "Education and Labour Market Outcomes in Sub-Saharan West Africa," Economics Papers from University Paris Dauphine 123456789/4353, Paris Dauphine University.
  10. Rama, Martin, 1998. "Wage misalignment in CFA countries: are labor market policies to blame?," Policy Research Working Paper Series 1873, The World Bank.
  11. Maloney, William F, 1999. "Does Informality Imply Segmentation in Urban Labor Markets? Evidence from Sectoral Transitions in Mexico," World Bank Economic Review, World Bank Group, World Bank Group, vol. 13(2), pages 275-302, May.
  12. Christophe Nordman & Anne-Sophie Robilliard & François Roubaud, 2009. "Decomposing Gender and Ethnic Earnings Gaps in Seven West African Cities," Working Papers, DIAL (Développement, Institutions et Mondialisation) DT/2009/07, DIAL (Développement, Institutions et Mondialisation).
  13. Lee, Lung-Fei, 1983. "Generalized Econometric Models with Selectivity," Econometrica, Econometric Society, Econometric Society, vol. 51(2), pages 507-12, March.
  14. Blanchflower, D.G. & Oswald, A., 1991. "What Makes an Entrepreneur?," Economics Series Working Papers 99125, University of Oxford, Department of Economics.
  15. Mankiw, N Gregory & Romer, David & Weil, David N, 1992. "A Contribution to the Empirics of Economic Growth," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 107(2), pages 407-37, May.
  16. Calves, Anne-Emmanuele & Schoumaker, Bruno, 2004. "Deteriorating Economic Context and Changing Patterns of Youth Employment in Urban Burkina Faso: 1980-2000," World Development, Elsevier, Elsevier, vol. 32(8), pages 1341-1354, August.
  17. Mazumdar, Dipak, 1983. "Segmented Labor Markets in LDCs," American Economic Review, American Economic Association, American Economic Association, vol. 73(2), pages 254-59, May.
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Citations

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Cited by:
  1. Pasquier-Doumer, Laure, 2012. "L'inégalité des chances sur le marché du travail urbain ouest-africain," Economics Papers from University Paris Dauphine 123456789/4712, Paris Dauphine University.
  2. Erol Taymaz, 2009. "Informality and Productivity: Productivity Differentials between Formal and Informal Firms in Turkey," ERC Working Papers, ERC - Economic Research Center, Middle East Technical University 0901, ERC - Economic Research Center, Middle East Technical University, revised Mar 2009.
  3. Pasquier-Doumer, Laure, 2009. "Reducing Inequality of Opportunities in the West African Urban Labour Markets: What Kind of Policy Matters?," Economics Papers from University Paris Dauphine 123456789/11239, Paris Dauphine University.

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