Competitive and Segmented Informal Labor Markets

Isabel Günther and Andrey Launov ()

No 72, W.E.P. - Würzburg Economic Papers from University of Würzburg, Department of Economics

Abstract: It has been recently argued that the informal sector of the labor market in a developing economy shows a dual structure with one part of it being competitive to the formal sector and another part being the result of market segmentation. To test this hypothesis we formulate an econometric model which allows for a heterogeneous informal sector with unobserved individual affiliation and which takes into account selection bias induced by the employment decision of individuals. Our test results for the urban labor market in Côte d'Ivoire indeed show existence of both competitive and segmented employment in the informal sector.

Keywords: developing economy; informal labor market; segmentation; comparative advantage; selection bias; latent structure; finite mixture models (search for similar items in EconPapers)
JEL-codes: J42 O17 (search for similar items in EconPapers)
Date: 2006
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Citations: View citations in EconPapers (21)

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Related works:
Working Paper: Competitive and Segmented Informal Labor Markets (2007)
Working Paper: Competitive and Segmented Informal Labor Markets (2006)
Working Paper: Competitive and Segmented Informal Labor Markets (2006)
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:wuewep:72

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