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The Inactive Population in Colombia and its Regional Characteristics. An Analysis from Micro Factorial Decomposition Models

Author

Listed:
  • Jorge Alberto Castro Puello

    (Universidad de los Andes)

  • José Guillermo Ariza Estévez

    (Universidad de los Andes)

  • Armando Ardila Delgado

    (Universidad del Rosario)

Abstract

This document tries to explain the differences in labor inactivity rates between each department of Colombia and the rest of the country. This differential is broken down by distinguishing between discrepancies in observable characteristics (i.e., age distribution, percentage of men and women, income, employability, etc.) and differences in unobservable characteristics (culture, traditions, etc.). For this we use a micro factorial decomposition model for nonlinear models applied to a probit model on the decision of whether or not to be inactive at work. There are 4 subgroups of departments depending on which factor most influences the definition of their labor participation. It was found that it is more common to find departments with a higher rate of inactivity attributed to unobservable factors.

Suggested Citation

  • Jorge Alberto Castro Puello & José Guillermo Ariza Estévez & Armando Ardila Delgado, 2022. "The Inactive Population in Colombia and its Regional Characteristics. An Analysis from Micro Factorial Decomposition Models," Lecturas de Economía, Universidad de Antioquia, Departamento de Economía, issue 96, pages 31-70, January-J.
    • Handle: RePEc:lde:journl:y:2022:i:96:p:31-70
    DOI: 10.17533/udea.le.n96a343954
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    More about this item

    Keywords

    participation rate; labor market; micro factorial decomposition; regional economies; probit.;
    All these keywords.

    JEL classification:

    • C13 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Estimation: General
    • J01 - Labor and Demographic Economics - - General - - - Labor Economics: General
    • R10 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - General

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