Labor Market Distortions in Côte d’Ivoire : Analyses of Employer-Employee Data from the Manufacturing Sector

Labor Market Distortions in Côte d’Ivoire : Analyses of Employer-Employee Data from the Manufacturing Sector

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The authors investigate the extent and nature of distortions in the labor market in the Republic of Côte d'Ivoire by using quantile regression analysis on employer-employee data from the manufacturing sector. They find that the labor markets in Côte d'Ivoire do not seem to be much distorted. Unions may influence employment through tenure but do not seem to influence wages directly except for vulnerable minorities that seem protected by unions. Establishment-size wage effects are pronounced and highest for white-collar workers. This may be explained by the efficiency wage theory, so that, even in the absence of unions, segmentation and inefficiencies will still be present as long as firms seek to retain their employees by paying wages above the market clearing level. The inefficiency arising from establishment-size wage effects can be mitigated by education. Furthermore, the authors find that the premium to education is highly significantly positive only for higher education, and not for basic education, indicating that educational policies should also focus on higher education.

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Bibliographic Details
Main Authors: Kristensen, Nicolai, Verner, Dorte
Language:English
Published: World Bank, Washington, DC 2005-11
Subjects:ATTRITION, AVERAGE WAGES, BASIC EDUCATION, CAREER, COLLECTIVE BARGAINING, EDUCATED WORKFORCE, EDUCATIONAL POLICIES, EFFICIENCY WAGE THEORY, EMPLOYEE, EMPLOYMENT, FIRING COSTS, FIRM LEVEL, FIRM SIZE, HIGH EARNERS, HIGH WAGE, HIGH WAGES, HIGHER EDUCATION, HOUSEHOLD SURVEYS, HUMAN CAPITAL, HUMAN CAPITAL EARNINGS, INCOME DISTRIBUTION, INCOME GENERATION, JOB SECURITY, LABOR DEMAND, LABOR FORCE, LABOR MARKET, LABOR MARKETS, LABOR SUPPLY, LITERATURE, MALE WORKERS, MINIMUM WAGES, OCCUPATION, ON-THE-JOB TRAINING, PAPERS, PERSONNEL, PREVIOUS RESULTS, PRODUCTION WORKERS, REAL WAGES, RECOMMENDATIONS, SAHARA, SCHOOL QUALITY, SECONDARY EDUCATION, STRUCTURAL ADJUSTMENT, SUB-SAHARAN AFRICA, TOTAL LABOR FORCE, UNION MEMBERSHIP, UNSKILLED WORKERS, WAGE BARGAINING, WAGE BILL, WAGE DIFFERENTIAL, WAGE DIFFERENTIALS, WAGE DISTRIBUTION, WAGE EFFECT, WAGE EFFECTS, WAGE SECTOR, WORK IN PROGRESS, WORKER, WORKERS, WORKING, WORKING CONDITIONS, WORKPLACE,
Online Access:http://documents.worldbank.org/curated/en/2005/11/6413196/labor-market-distortions-cote-divoire-analyses-employer-employee-data-manufacturing-sector
https://hdl.handle.net/10986/8566
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Summary:The authors investigate the extent and nature of distortions in the labor market in the Republic of Côte d'Ivoire by using quantile regression analysis on employer-employee data from the manufacturing sector. They find that the labor markets in Côte d'Ivoire do not seem to be much distorted. Unions may influence employment through tenure but do not seem to influence wages directly except for vulnerable minorities that seem protected by unions. Establishment-size wage effects are pronounced and highest for white-collar workers. This may be explained by the efficiency wage theory, so that, even in the absence of unions, segmentation and inefficiencies will still be present as long as firms seek to retain their employees by paying wages above the market clearing level. The inefficiency arising from establishment-size wage effects can be mitigated by education. Furthermore, the authors find that the premium to education is highly significantly positive only for higher education, and not for basic education, indicating that educational policies should also focus on higher education.

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