Title Fiscal policy implications for labor market outcomes in middle-income countries / prepared by Ara Stepanyan and Lamin Leigh

Published [Washington, D.C.] : International Monetary Fund, ©2015

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Description 1 online resource (24 pages) : color illustrations Series IMF working paper, 1018-5941 ; WP/15/17 IMF working paper ; WP/15/17. Contents Cover Page; Title Page; Copyright Page; Contents; Figure; Tables; Appendix; I. Introduction; II. Literature Review; III. Methodology; IV. Empirical Results; 1. Selected UMICs: Public Employment and Unemployment Rate, 1995-2011; 1. Public Employment and Unemployment Rate; 2. Estimates of Unemployment Based on Labor Market Institution and Public Employment; 3. Estimates of Private Employment Based on Labor Market Institutions and Public Employment; 4. Three-Stage Least Squares Estimates of Simultaneous Equations: Unemployment-Public Employment and Private Employment-Public Employment 5. Three-Stage Least Squares Estimates of Public Employment Impact on Unemployment and Private Employment Based on the Size of Public Rent and the Substitutability of Public ProductionV. Conclusions; I. Theoretical Model; References; Footnotes Summary Many governments have initiated public employment programs or expanded the existing ones in response to high unemployment. However, in many middle-income countries, a relatively large government coexists with persistently high unemployment. This paper explores the question of whether public employment gives rise to distortions in the labor market in the medium to long-run. Our findings do not provide any evidence that public employment reduces unemployment rate. The analysis in this paper shows that large public employment does significantly affect labor market outcomes in middle-income countries and leads to job destruction in the private sector. The extent of the impact is largely influenced by the degree of substitutability between public and private production and the size of the rents in the public sector.--Abstract Notes "January 2015." "African Department." Bibliography Includes bibliographical references (pages 22-23) Notes Online resource; title from pdf title page (IMF.org Web site, viewed January 29, 2015) Subject Unemployment -- Developing countries -- Econometric models Civil service -- Developing countries -- Econometric models Labor market -- Developing countries -- Econometric models Fiscal policy -- Developing countries -- Econometric models Fiscal policy -- Econometric models Labor market -- Econometric models Unemployment -- Econometric models Developing countries Form Electronic book Author Leigh, Lamin, author. International Monetary Fund. African Department. ISBN 9781498316217 1498316212 1484326806 9781484326800 9781498380522 1498380522

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