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Labor market distortions in Cote d'Ivoire : analyses of employer-employee data from the manufacturing sector

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  • Kristensen, Nicolai
  • Verner, Dorte

Abstract

The authors investigate the extent and nature of distortions in the labor market in the Republic of Côte d'Ivoire by using quantile regression analysis on employer-employee data from the manufacturing sector. They find that the labor markets in Côte d'Ivoire do not seem to be much distorted. Unions may influence employment through tenure but do not seem to influence wages directly except for vulnerable minorities that seem protected by unions. Establishment-size wage effects are pronounced and highest for white-collar workers. This may be explained by the efficiency wage theory, so that, even in the absence of unions, segmentation and inefficiencies will still be present as long as firms seek to retain their employees by paying wages above the market clearing level. The inefficiency arising from establishment-size wage effects can be mitigated by education. Furthermore, the authors find that the premium to education is highly significantly positive only for higher education, and not for basic education, indicating that educational policies should also focus on higher education.

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Bibliographic Info

Paper provided by The World Bank in its series Policy Research Working Paper Series with number 3771.

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Date of creation: 01 Nov 2005
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Handle: RePEc:wbk:wbrwps:3771

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Keywords: Labor Markets; Tertiary Education; Access&Equity in Basic Education; Labor Standards; Work&Working Conditions;

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  1. Koenker, Roger W & Bassett, Gilbert, Jr, 1978. "Regression Quantiles," Econometrica, Econometric Society, vol. 46(1), pages 33-50, January.
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  3. Rama, Martin, 1998. "Wage misalignment in CFA countries: are labor market policies to blame?," Policy Research Working Paper Series 1873, The World Bank.
  4. Schaffner, Julie Anderson, 1998. "Premiums to employment in larger establishments: evidence from Peru," Journal of Development Economics, Elsevier, vol. 55(1), pages 81-113, February.
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  8. Moshe Buchinsky, 1998. "Recent Advances in Quantile Regression Models: A Practical Guideline for Empirical Research," Journal of Human Resources, University of Wisconsin Press, vol. 33(1), pages 88-126.
  9. Buchinsky, Moshe, 1995. "Estimating the asymptotic covariance matrix for quantile regression models a Monte Carlo study," Journal of Econometrics, Elsevier, vol. 68(2), pages 303-338, August.
  10. Verner, Dorte, 1999. "Wage and productivity gaps - evidence from Ghana," Policy Research Working Paper Series 2168, The World Bank.
  11. Verner, Dorte, 1999. "Are wages and productivity in Zimbabwe affected by human capital investment and international trade?," Policy Research Working Paper Series 2101, The World Bank.
  12. Hoddinott, John, 1996. "Wages and Unemployment in an Urban African Labour Market," Economic Journal, Royal Economic Society, vol. 106(439), pages 1610-26, November.
  13. Maloney, William F. & Pontual Ribeiro, Eduardo, 1999. "Efficiency wage and union effects in labor demand and wage structure in Mexico - An application of quantile analysis," Policy Research Working Paper Series 2131, The World Bank.
  14. Grootaert, Christiaan, 1990. "Returns to formal and informal vocational education in Cote d'Ivoire: The role of the structure of the labor market," Economics of Education Review, Elsevier, vol. 9(4), pages 309-319, December.
  15. van der Gaag, Jacques & Vijverberg, Wim, 1988. "A Switching Regression Model for Wage Determinants in the Public and Private Sectors of a Developing Country," The Review of Economics and Statistics, MIT Press, vol. 70(2), pages 244-52, May.
  16. Gaag, Jacques & van der Vijverberg, Wim, 1989. "Wage Determinants in Cote d'Ivoire: Experience, Credentials, and Human Capital," Economic Development and Cultural Change, University of Chicago Press, vol. 37(2), pages 371-81, January.
  17. Wim P. M. Vijverberg, 1993. "Educational Investments and Returns for Women and Men in Côte d'Ivoire," Journal of Human Resources, University of Wisconsin Press, vol. 28(4), pages 933-974.
  18. Komenan, A. G. & Grootaert, C., 1990. "Pay differences between teachers and other occupations: Some empirical evidence from cote d'ivoire," Economics of Education Review, Elsevier, vol. 9(3), pages 209-217, September.
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