An Occupational Choice Model for Developing Countries
AbstractMost occupational choice models introduce only two options for agents: entrepreneurial activities or wage-employment. However, these models represent inadequately the labor force distribution from developing countries, where an important proportion of the total work force are self-employed workers. Some models introduce self-employment as an occupational choice. These works have a common feature : at equilibrium, wage earners belong to the lower end of the income distribution. However, for a large set of developing countries, peasants and small proprietors are part of a self employment sector that can mostly be found in the lower end of the income distribution. In this work, in contrast with previous efforts, self-employment formation is consistent with data from most developing countries. We pay special attention to the conditions under which either the economy ends in a low income equilibrium, where self-employment is the only form of production; or alternatively, a high income equilibrium with a well developed labor market. We study some public policy issues, paying special attention to role of capital markets and the efficiency of schooling. --
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Bibliographic InfoPaper provided by Verein für Socialpolitik, Research Committee Development Economics in its series Proceedings of the German Development Economics Conference, Göttingen 2007 with number 15.
Date of creation: 2007
Date of revision:
Occupational Choice; Human Capital; Economic Development; General Equilibrium;
Find related papers by JEL classification:
- O12 - Economic Development, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
- J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
This paper has been announced in the following NEP Reports:
- NEP-ALL-2007-12-15 (All new papers)
- NEP-DEV-2007-12-15 (Development)
- NEP-ENT-2007-12-15 (Entrepreneurship)
- NEP-LAB-2007-12-15 (Labour Economics)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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