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Cohort Analysis of Labor Participation and Sectoral Composition of Employment in Ecuador

Author

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  • Diego Danny ONTANEDA JIMÉNEZ

    (Facultad de Ciencias Económicas y Administrativas, Grupo de Investigación en Economía Regional (GIER), Universidad de Cuenca, Ecuador.)

  • Wilson Alejandro GUZMÁN ESPINOZA

    (Department of Economics, Universidad de Las Américas, Quito, Ecuador.)

  • Luis Rodrigo MENDIETA MUÑOZ

    (Facultad de Ciencias Económicas y Administrativas, Grupo de Investigación en Economía Regional (GIER).)

  • Monica RĂILEANU SZELES

    (Transilvania University of Brasov and Institute for Economic Forecasting, Romania)

Abstract

The study assesses the contribution of cohort, age and business cycle effects to the evolution of labor participation rate and sectoral employment in Ecuador from 2000 to 2019. Being characterized by a large amount of informality, as well as by significant economic and institutional changes, Ecuador could provide new insights to the literature. The empirical analysis reveals that both female and male labor participation rate decreases for the younger generations. The life cycle profiles for sectoral employment show that formal employment rate has an inverted U-shaped form. In contrast, younger workers are found to be more likely to participate in the informal salaried sector, while self-employment notably increases with age. A sustained growth in formal employment rate is observed for the new generations, while the opposite occurs for the informal salaried and self-employment. Finally, the results suggest that female labor participation is strongly countercyclical, which correspond to the added worker effect hypothesis.

Suggested Citation

  • Diego Danny ONTANEDA JIMÉNEZ & Wilson Alejandro GUZMÁN ESPINOZA & Luis Rodrigo MENDIETA MUÑOZ & Monica RĂILEANU SZELES, 2022. "Cohort Analysis of Labor Participation and Sectoral Composition of Employment in Ecuador," Journal for Economic Forecasting, Institute for Economic Forecasting, vol. 0(3), pages 67-87, October.
    • Handle: RePEc:rjr:romjef:v::y:2022:i:3:p:67-87
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    References listed on IDEAS

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    Cited by:

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    More about this item

    Keywords

    age effects; period effects; cohort effects; labor participation; Ecuador; business cycle.;
    All these keywords.

    JEL classification:

    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • O17 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements

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