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Labor market policy in developing countries : a selective review of the literature and needs for the future

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Author Info

  • Fields, Gary S.

Abstract

This paper presents a selective overview of the literature on modeling labor market policies in developing countries. It considers welfare economics, theoretical models, and empirical evidence to highlight the three general features needed in future research on labor market policy in developing countries. The author identifies desirable research components (welfare economics, theoretical modeling, and empirical modeling) and pitfalls in the literature (inappropriate use of productivity, reliance on wrong kinds of empirical studies, lack of cost-benefit analysis, attention to only a subset of the goods and bads, and fallacy of composition). The paper concludes with suggested topics and methods for future research. The author states that sound labor market policy requires sound labor market models. The paper makes a case for developing policy based on explicit evaluation criteria, specific theoretical models, and comprehensive empirical evidence.

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Bibliographic Info

Paper provided by The World Bank in its series Policy Research Working Paper Series with number 4362.

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Date of creation: 01 Sep 2007
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Handle: RePEc:wbk:wbrwps:4362

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Related research

Keywords: Labor Markets; Labor Policies; Markets and Market Access; Population Policies;

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Cited by:
  1. Olivier Bargain & Prudence Kwenda, 2010. "Is Informality Bad? - Evidence from Brazil, Mexico and South Africa," Working Papers, School Of Economics, University College Dublin 201003, School Of Economics, University College Dublin.
  2. Hasan, Rana & Jandoc, Karl Robert L., 2009. "Quality of Jobs in the Philippines: Comparing Self-Employment with Wage Employment," ADB Economics Working Paper Series 148, Asian Development Bank.
  3. Bargain, Olivier & Kwenda, Prudence, 2009. "The Informal Sector Wage Gap: New Evidence Using Quantile Estimations on Panel Data," IZA Discussion Papers 4286, Institute for the Study of Labor (IZA).
  4. Hartmut Lehmann & Norberto Pignatti, 2008. "Informal Employment Relationships and Labor Market Segmentation in Transition Economies: Evidence from Ukraine," ESCIRRU Working Papers 3, DIW Berlin, German Institute for Economic Research.
  5. Marouani, Mohamed A. & Robalino, David A., 2008. "Assessing interactions among education, social insurance, and labor market policies in a general equilibrium framework: an application to Morocco," Policy Research Working Paper Series 4681, The World Bank.

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