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The promise and peril of youth entrepreneurship in the Middle East and North Africa

Author

Listed:
  • Caroline Krafft
  • Reham Rizk

Abstract

Purpose - Entrepreneurship is promoted as a solution to high rates of youth unemployment around the world and especially in the Middle East and North Africa (MENA). This paper investigates the potential for youth entrepreneurship to alleviate unemployment, focusing on Egypt, Jordan and Tunisia. Design/methodology/approach - The authors examine who entrepreneurs are (in comparison to the unemployed), using multinomial logit models. The authors compare entrepreneurs' and wage workers' working conditions and earnings. They exploit panel data to assess earnings and occupational dynamics. They specifically use the Labor Market Panel Surveys of 2012 (Egypt), 2016 (Jordan), and 2014 (Tunisia), along with previous waves. Findings - The authors find that entrepreneurs are the opposite of the unemployed in MENA. The unemployed are disproportionately young, educated and women. Entrepreneurs are older, less educated and primarily men. Entrepreneurship does not generally lead to higher earnings and does have fewer benefits. Originality/value - Promoting youth entrepreneurship is not only unlikely to be successful in reducing youth unemployment in MENA, but also, if successful, may even be harmful to youth.

Suggested Citation

  • Caroline Krafft & Reham Rizk, 2021. "The promise and peril of youth entrepreneurship in the Middle East and North Africa," International Journal of Manpower, Emerald Group Publishing Limited, vol. 42(8), pages 1500-1526, July.
    • Handle: RePEc:eme:ijmpps:ijm-05-2020-0200
    DOI: 10.1108/IJM-05-2020-0200
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    Citations

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    Cited by:

    1. Ragui Assaad & Caroline Krafft, 2023. "Labour market dynamics and youth unemployment in the Middle East and North Africa: Evidence from Egypt, Jordan, and Tunisia," LABOUR, CEIS, vol. 37(4), pages 519-553, December.
    2. Caroline Krafft & Ragui Assaad & Khandker Wahedur Rahman & Maakwe Cumanzala, 2024. "How do small formal and informal firms in Egypt compare? An analysis of firm characteristics and implications for formalization efforts," Review of Development Economics, Wiley Blackwell, vol. 28(3), pages 1292-1315, August.

    More about this item

    Keywords

    Entrepreneurship; Self-employment; Youth; Unemployment; Middle East and North Africa; J21; J24; J31; N15;
    All these keywords.

    JEL classification:

    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • N15 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations - - - Asia including Middle East

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