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Measuring Unemployment in Developing Countries: The Case of Indonesia

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  • Daniel Suryadarma
  • Asep Suryahadi
  • Sudarno Sumarto

Abstract

. Measuring unemployment in developing countries is not straightforward due to the presence of a large number of discouraged workers. Including them into the labor force is sometimes appropriate in order to reflect the true state of unemployment. However, the decision must be based on careful research. This study provides a case study of Indonesia, whose decision to include discouraged workers into its labor force resulted in an artificially high unemployment rates and disguised the actual post‐crisis decline in unemployment in Indonesia. The discouraged workers can be classified based on their willingness to work. If Indonesia still wants to include discouraged workers into the labor force, only those willing to work should be included.

Suggested Citation

  • Daniel Suryadarma & Asep Suryahadi & Sudarno Sumarto, 2007. "Measuring Unemployment in Developing Countries: The Case of Indonesia," LABOUR, CEIS, vol. 21(3), pages 541-562, September.
    • Handle: RePEc:bla:labour:v:21:y:2007:i:3:p:541-562
    DOI: 10.1111/j.1467-9914.2007.00374.x
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    References listed on IDEAS

    as
    1. Mr. R. Brooks, 2002. "Why is Unemployment High in the Philippines?," IMF Working Papers 2002/023, International Monetary Fund.
    2. Byrne, David & Strobl, Eric, 2004. "Defining unemployment in developing countries: evidence from Trinidad and Tobago," Journal of Development Economics, Elsevier, vol. 73(1), pages 465-476, February.
    3. Stefano DellaVigna & M. Daniele Paserman, 2005. "Job Search and Impatience," Journal of Labor Economics, University of Chicago Press, vol. 23(3), pages 527-588, July.
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    Cited by:

    1. Murali Kuchibhotla & Peter F. Orazem & Sanjana Ravi, 2020. "The scarring effects of youth joblessness in Sri Lanka," Review of Development Economics, Wiley Blackwell, vol. 24(1), pages 269-287, February.
    2. Kuchibhotla, Murali, 2013. "Three essays in development economics," ISU General Staff Papers 201301010800004461, Iowa State University, Department of Economics.
    3. Dorrit Posel & Daniela Casale & Claire Vermaak, 2014. "Job Search and the Measurement of Unemployment in South Africa," South African Journal of Economics, Economic Society of South Africa, vol. 82(1), pages 66-80, March.
    4. Aysit Tansel & H. Mehmet Taşçı, 2010. "Hazard Analysis of Unemployment Duration by Gender in a Developing Country: The Case of Turkey," LABOUR, CEIS, vol. 24(4), pages 501-530, December.
    5. Dula Etana & Degefa Tolossa, 2017. "Unemployment and Food Insecurity in Urban Ethiopia," African Development Review, African Development Bank, vol. 29(1), pages 56-68, March.

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