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Social Security and Labour Supply in Ethiopia

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  • Melaku, Don

Abstract

This paper examines the effect of social security on labor supply using the traditional labor force participation model. Application of a log it regression to the survey data yields results that go counter to theory. That is, the availability of pension income does not reduce labor force participation rates. It is also found, that as age increases, participation in the labor force is significantly reduced for women than men and also for blue-collar jobs that white-collar ones. This result has a policy implication that there is a need for retirement age discrimination act by sex and by type of job. Logit models were estimated for different age groups and it is found that there is no problem arising due to aging or health, which is the mai determinants in setting retirement age, until the age of 60 for participation in the labor force. The results also indicate that the probability to participate in the labor force reduces by 0.09 if one goes from age group of 56-60 to the age group of 61-65.

Suggested Citation

  • Melaku, Don, 2001. "Social Security and Labour Supply in Ethiopia," Ethiopian Journal of Economics, Ethiopian Economics Association, vol. 7(1), pages 119-119, January.
    • Handle: RePEc:ags:eeaeje:250252
    DOI: 10.22004/ag.econ.250252
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    Keywords

    Labor and Human Capital;

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