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Transitions across labor market states including formal/informal division in Egypt

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  • Aysit Tansel
  • Zeynel Abidin Ozdemir

Abstract

This study examines the worker transitions across labor market states including formal/informal division using panel data of 2006 to 2012 from Egypt. We generate a broad set of facts about labor market dynamics in Egypt. We first develop transition probabilities by gender across different labor market states including formal/informal sectors utilizing Markov transition processes. Government employment is the most persistent labor market state for both men and women and the out of labor force is the second most persistent labor market state for women. Unemployment is the most mobile labor market state. Informal private wage work and self‐employed–agriculture are also relatively mobile labor market states. We next identify the effects of individual, household and job characteristics on different mobility patterns by estimating multinomial logit models. We find that gender, age, education, experience, and several sectors of economic activity are associated with the transition probabilities between the labor market states considered such as formal wage, informal wage, self‐employment, unemployment, government employment, and out of labor market. Education, in particular, university degree or above is noted to play a vital role in the probability of transitions across several labor market states.

Suggested Citation

  • Aysit Tansel & Zeynel Abidin Ozdemir, 2019. "Transitions across labor market states including formal/informal division in Egypt," Review of Development Economics, Wiley Blackwell, vol. 23(4), pages 1674-1695, November.
    • Handle: RePEc:bla:rdevec:v:23:y:2019:i:4:p:1674-1695
    DOI: 10.1111/rode.12620
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    Citations

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    Cited by:

    1. Benjamín Villena-Roldán, 2024. "Unpacking the Persistence of Informality," Journal of Labor Research, Springer, vol. 45(2), pages 203-231, June.
    2. Philippe Adair & Shireen AlAzzawi & Vladimir Hlasny, 2023. "Fostering Decent Jobs in MENA Countries: Segmented Employment, Occupational Mobility and Formalising Informality," Erudite Working Paper 2023-05, Erudite.
    3. Philippe Adair & Vladimir Hlasny & Mariem Omrani & Kareem Sharabi Rosshandler, 2022. "Fostering social businesses and formalising the informal economy in MENA countries," Erudite Working Paper 2022-03, Erudite.
    4. Philippe Adair, 2021. "The informal economy and gender inequalities in North Africa," Erudite Working Paper 2021-07, Erudite.
    5. Philippe Adair & Vladimir Hlasny, 2022. "Labour Market Segmentation and Formalising Informality in MENA Countries," Erudite Working Paper 2022-07, Erudite.
    6. Tansel, Aysit & Keskin, Halil Ibrahim & Ozdemir, Zeynel Abidin, 2020. "Public-private sector wage gap by gender in Egypt: Evidence from quantile regression on panel data, 1998–2018," World Development, Elsevier, vol. 135(C).
    7. Panchanan Das, 2023. "Creation and Destruction of Jobs in Urban Labour Market: Role of Gender, Caste and Religion in India," The Indian Journal of Labour Economics, Springer;The Indian Society of Labour Economics (ISLE), vol. 66(1), pages 225-237, March.
    8. Shireen Alazawi & Vladimir Hlasny, 2023. "Youths’ Employment Vulnerability amidst a Lingering Crisis: Evidence from the Middle East," Hacienda Pública Española / Review of Public Economics, IEF, vol. 247(4), pages 155-186, December.

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