Labor Market Representation in Quantitative Macroeconomic Models for Developing Countries: An Application to Côte d'Ivoire

Vincent Bodart and Jean Le Dem
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Jean Le Dem: International Monetary Fund

IMF Staff Papers, 1996, vol. 43, issue 2, 419-451

Abstract: This paper presents a quantitative macroeconomic model that accounts for key features of the labor market in developing countries. Primarily inspired by Côte d'Ivoire, the model contrasts a formal urban sector, where wages are rigidly fixed and employment is subject to firms' profit-seeking behavior, with urban and rural informal sectors, where wages are flexible and employment is affected by fluctuations in formal sector employment. Dynamic simulations assess the impact on key macroeconomic variables of exogenous and policy-induced shocks, highlighting the roles of rural-urban migrations and capital accumulation in the informal urban sector.

JEL-codes: J21 J4 O17 O18 (search for similar items in EconPapers)
Date: 1996
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Persistent link: https://EconPapers.repec.org/RePEc:pal:imfstp:v:43:y:1996:i:2:p:419-451

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