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Heterogeneous labor and structural change in low- and middle-income, resource-dependent countries

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  • Peter Howie

    (Nazarbayev University)

  • Zauresh Atakhanova

    (Academy of Public Administration of Kazakhstan)

Abstract

In this paper we analyse structural change and its implications for labor productivity growth in Kazakhstan, Malawi, and Zambia, three resource-dependent countries, during the resource boom that lasted from 2001 to 2013. We pay particular attention to the effects of labor heterogeneity by assessing the demand for pre-determined occupations. The effects of structural change on heterogeneous labor markets are studied by developing a model to explain the observed patterns of labor migration between sectors. We use labor force survey data from Kazakhstan and census microdata for Malawi and Zambia available from the IPUMS International database. In-depth examinations are performed using a decomposition technique and multinomial logit regression to examine labor demand patterns. Results show that private services experienced the largest increase in employment across all occupations and relative skill deepening. Substantial decreases in managers occurred in public services. The results indicate that structural change is fundamental in shaping the allocation of individuals across different occupations within the labor market. Moreover, during a resource boom, the results indicate that the public sector experiences a skill-drain that may affect the quality of governance.

Suggested Citation

  • Peter Howie & Zauresh Atakhanova, 2020. "Heterogeneous labor and structural change in low- and middle-income, resource-dependent countries," Economic Change and Restructuring, Springer, vol. 53(2), pages 297-332, May.
    • Handle: RePEc:kap:ecopln:v:53:y:2020:i:2:d:10.1007_s10644-018-9242-9
    DOI: 10.1007/s10644-018-9242-9
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    2. Zauresh Atakhanova, 2021. "Kazakhstan’s oil boom, diversification strategies, and the service sector," Mineral Economics, Springer;Raw Materials Group (RMG);Luleå University of Technology, vol. 34(3), pages 399-409, October.

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    More about this item

    Keywords

    Structural change; Labor productivity; Resource boom; Kazakhstan; Malawi; Zambia;
    All these keywords.

    JEL classification:

    • L16 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Industrial Organization and Macroeconomics; Macroeconomic Industrial Structure
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • Q32 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - Exhaustible Resources and Economic Development
    • Q33 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - Resource Booms (Dutch Disease)

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