IDEAS home Printed from https://ideas.repec.org/a/epc/journl/v10y2015i1p13-22.html
   My bibliography  Save this article

Wage differentials and economic restrictions: Evidence from the Occupied Palestinian Territories

Author

Listed:
  • Belal Fallah

    (Department of Economics and Financial Sciences, Palestine Polytechnic University, Hebron, Palestine.)

  • Yousef Daoud

    (Department of Economics, Birzeit University, Ramallah, Palestine.)

Abstract

The article examines the wage impact of Israel’s constraints on economic activities and infrastructure development in the West Bank’s Area C. We provide evidence to show that Area C workers suffer a wage penalty of about 8 percent relative to workers in Areas A and B. The results also show that when controlling for worker characteristics, the magnitude of the Area C wage differential drops by about half. We then extend our analysis to compare average wages between Area C workers and other rural workers and show that the wage difference is statistically insignificant. This indicates that the Area C wage differential we observe can be attributed primarily to a rural environment effect rather than to Israeli economic restrictions placed on Area C per se. This result indicates that the effect of Israeli restrictions on Area C wages is neutralized. We show that negative labor supply shocks (commuting) serve as a potential transmission mechanism. Specifically, we show that Area C residents are more likely to commute than their peers in other rural areas.

Suggested Citation

  • Belal Fallah & Yousef Daoud, 2015. "Wage differentials and economic restrictions: Evidence from the Occupied Palestinian Territories," Economics of Peace and Security Journal, EPS Publishing, vol. 10(1), pages 13-22, April.
    • Handle: RePEc:epc:journl:v:10:y:2015:i:1:p:13-22
    as

    Download full text from publisher

    File URL: http://www.epsjournal.org.uk/index.php/EPSJ/article/view/200
    Download Restriction: Open access 24 months after original publication.
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Yousef Daoud & Belal Fallah, 2016. "The differential impact of employment in agriculture on wages for rural and non-rural Palestine," IZA Journal of Labor & Development, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 5(1), pages 1-19, December.
    2. Sameh Hallaq, 2019. "Wage Differential between Palestinian Non-refugees and Palestinian Refugees in the West Bank and Gaza," Economics Working Paper Archive wp_941, Levy Economics Institute.
    3. Sameh Hallaq, 2020. "The Palestinian Labor Market over the Last Three Decades," Economics Working Paper Archive wp_976, Levy Economics Institute.

    More about this item

    Keywords

    Economic restrictions; wage differentials; commuting; labor supply; labor demand;
    All these keywords.

    JEL classification:

    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • J01 - Labor and Demographic Economics - - General - - - Labor Economics: General

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:epc:journl:v:10:y:2015:i:1:p:13-22. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Michael Brown, Managing Editor, EPSJ (email available below). General contact details of provider: https://edirc.repec.org/data/ecaarea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.