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An Exploratory Analysis of Heterogeneity on Regional Labour Markets and Unemployment Rates in Colombia: An MFACT approach

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  • Camilo Alberto Cárdenas Hurtado
  • María Alejandra Hernández Montes
  • Jhon Edwar Torres Gorron

Abstract

In this paper we study the structural determinants of differentials in unemployment rates and labour markets’ performance for colombian cities. Following the framework proposed by Elhorst (2003) and using cross-sectional data for 23 metropolitan areas, we apply an extension of a principal axes method proposed by B´ecue-Bertaut and Pag`es (2004, 2008), Multiple Factor Analysis for Multiple Contingency Tables (MFACT), in order to establish unobserved factors that are relevant when disentangling the heterogeneity captured by groups of variables that are considered to explain regional unemployment differentials. Our findings suggest that differences on qualified labour supply levels, participation incentives and age structure are important to understand regional heterogeneity on labour markets and unemployment rates. In addition, we find that cities that display high unemployment rates do not necessarily share the same characteristics, that is, frictions that originate unemployment are not the same across colombian cities.

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  • Camilo Alberto Cárdenas Hurtado & María Alejandra Hernández Montes & Jhon Edwar Torres Gorron, 2014. "An Exploratory Analysis of Heterogeneity on Regional Labour Markets and Unemployment Rates in Colombia: An MFACT approach," Borradores de Economia 802, Banco de la Republica de Colombia.
    • Handle: RePEc:bdr:borrec:802
    DOI: 10.32468/be.802
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    Cited by:

    1. Ham Andrés & Maldonado Darío & Guzmán-Gutiérrez Carlos Santiago, 2021. "Recent trends in the youth labor market in Colombia: Diagnosis and policy challenges," IZA Journal of Labor Policy, Sciendo & Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 11(1), pages 1-62, January.
    2. Luis Eduardo Arango & Ana María Ríos, 2015. "Duración del desempleo en Colombia: género, intensidad de búsqueda y anuncios de vacantes," BORRADORES DE ECONOMIA 012528, BANCO DE LA REPÚBLICA.
    3. Luis E. Arango & Luz A. Flórez, 2020. "Determinants of structural unemployment in Colombia: a search approach," Empirical Economics, Springer, vol. 58(5), pages 2431-2464, May.
    4. Enrique López-Bazo & Juan C. Duque & Gustavo A. García & Paula Herrera-Idágarra, 2015. "Heterogeneidad regional en las diferencias por género en las tasas de desempleo en Colombia," IDB Publications (Working Papers) 89037, Inter-American Development Bank.
    5. Luis E. Arango & Luz A. Flórez, 2017. "Informalidad laboral y elementos para un salario mínimo diferencial por regiones en Colombia," Borradores de Economia 1023, Banco de la Republica de Colombia.
    6. Arango, Luis Eduardo & Castellani, Francesca & Obando, Nataly, 2016. "It is Mainly About Where You Work!: Labor Demand in the Colombian Manufacturing Sector," IDB Publications (Working Papers) 7831, Inter-American Development Bank.
    7. Luis Eduardo Arango & Ana María Ríos, 2015. "Duración del desempleo en Colombia: género, intensidad de búsqueda y anuncios de vacantes," Borradores de Economia 12528, Banco de la Republica.
    8. Luis E. Arango & Luz A. Flórez & María A. Olarte-Delgado, 2019. "Precio del carbón y dinámica laboral en Valledupar," Revista de Economía del Rosario, Universidad del Rosario, vol. 22(2), pages 313-370, December.
    9. Luis Eduardo Arango & Gabriela Bonilla, 2015. "Human capital agglomeration and social returns to education in Colombia," Borradores de Economia 12788, Banco de la Republica.
    10. Luis E. Arango & Francesca Castellani & Nataly Obando, 2019. "Heterogeneous labour demand in the Colombian manufacturing sector," Journal for Labour Market Research, Springer;Institute for Employment Research/ Institut für Arbeitsmarkt- und Berufsforschung (IAB), vol. 53(1), pages 1-19, December.
    11. Luis E. Arango & Francesca Castellani & Nataly Obando, 2016. "It is mainly about where you work! Labor demand in the Colombian manufacturing sector," Borradores de Economia 933, Banco de la Republica de Colombia.
    12. Cristina Fernández, 2019. "Empleo y emprendimiento en Bogotá," Informes de Investigación 17931, Fedesarrollo.

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    More about this item

    Keywords

    Unemployment rate; regional; heterogeneity; differentials; factor analysis.;
    All these keywords.

    JEL classification:

    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population
    • J40 - Labor and Demographic Economics - - Particular Labor Markets - - - General

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