Labor Force Growth Research Articles

Merchandise Export Diversification Strategy for Tanzania - Promoting Inclusive Growth, Economic Complexity and Structural Change

In the pursuit of structural transformation and inclusive growth, this paper identifies industries in Tanzania which can accumulate new productive knowledge and diversify the economy. The analysis has two main components. First, a Product Space analysis identifies niches primarily within the manufacturing sector, which Tanzania should promote in order to move up the complexity scale and stimulate structural change. The identification process applies a supply-side network method following the literature on Economic Complexity and combines it with a demand-driven gravity model on merchandise export. Hence, we identify industries that are tangible given Tanzania’s current productive knowledge and are most feasible for Tanzania to target given product-specific trade resistance and geographically dispersed demand. Second, as generating jobs for the rapidly growing labour force is a prime political priority in Tanzania, we construct a labour opportunity index in order to display which industries are correlated with a high labour intensity. We find that there is a larger scope for learning spillovers in the relatively more complex sectors, such as machinery and chemicals, whereas the less complex sectors, such as agro-processing and construction, are correlated with higher employment creation. The paper is, to the best of our knowledge, the first comprehensive study of economic complexity and structural change in Tanzania that systematically accounts for both supply and demand-side factors.

Impacts of Migration on the Economy of North-East Nigeria

Nigeria as a nation state has shared in the threats caused by globalism. North-Eastern region of Nigeria has in the last couple of years, been witnessing serial outward movement of its population to other neighboring countries. This is perceived as a result of lag on the nature and configuration of Nigerian security engagements which is at the verge of losing war against Boko Haram. More worrisome is the continued decline in the economies of the region due to quantum exit of their labour force to other destinations. The focus of the study is to examine the pull-push variables that had implicated the mass exodus of the labour force, the implications of their exodus on the economy of the region, and the institutional framework designed to revamp their economy. The paper adopted qualitative method, and data were generated through secondary sources and analyzed using content-analysis. The theoretical framework for the study was the Routine Activity Theory (RAT), as propounded by Cohen and Felson, and validated through the empirical works of Clarke and Felson, Felson and Clarke, and Felson. The findings of the study revealed that despite the exerted efforts by government through its institutions, the North-east region has continued to witness mass exodus of people from region, and this has affected the labour force and economic growth of the zone. The paper strongly recommends among others: proactive and total overhauling of the security architecture in the area, as well as establishment of a formidable economic recovery plan/ actions for the zone.

Contractions in Chinese Fertility and Savings: Long Run Domestic and Global Implications

Following three decades of rapid but unbalanced economic growth, China's reform and policy agenda are set to rebalance the economy toward consumption while maintaining a rate of GDP growth near seven per cent. Among the headwinds it faces is a demographic contraction that brings slower, and possibly negative, labour force growth and relatively rapid ageing. While the lower saving rates that result from consumption-oriented policies and rising aged dependency may contribute to a rebalancing of the economy, in the long run they will reduce both GDP growth and per capita income. Moreover, while an effective transition from the one-child policy to a two-child policy would help sustain growth and eventually mitigate the aged dependency problem, it would set real per capita income on a still lower path. These conundrums are examined using a global economic and demographic model, which embodies the main channels through which fertility and saving rates impact on economic performance. The results quantify the associated trade-offs and show that continuing demographic and saving contractions in China would alter the trajectory of the global economy as well.

The dynamic relationships between the female labour force and the economic growth

PurposeIn this study, the relationship between female labour force participation rate and economic growth is investigated in middle-income countries. The study covers the period of 2001–2016 by employing a dynamic panel approach. Pooled Ordinary Least Square and Fixed Effects model estimations are calculated as a decision criterion to select proper GMM Method. The outcomes indicate that the proper estimation technique, which is a System-GMM model, evidences the U Feminisation Theory for the middle-income countries while controlling all other factors.Design/methodology/approachThe novelty of this study is that the research not only employs both difference and system generalised method of moments (GMM) estimators but also includes main explanatory variables such as education, fertility, and total labour force rate. The study provides an opportunity to review the U-shape nexus between the female labour force and economic growth while controlling education, fertility and total labour participation rate.FindingsThe estimation implies that middle-income countries support a U-shaped relationship. The fertility rate does not impact on the female labour force, and education and total labour force level have a positive influence on women's participation in the labour market.Research limitations/implicationsThis study used data that include the period of 2001–2016 for middle-income countries. So, further studies can use different periods of data or different countries.Practical implicationsThe authors emphasise the importance of economic growth for female labour force for middle-income countries. Thus, a country intending to increase female labour force should also focus on its economic growth. As the study points out, middle-income countries staying under the minimum threshold, $4698.15 (per capita), should priorities their economic improvement policies to reach their female labour force participation goal. Those countries also should be prepared for a female labour force participation declining phase until they reach the turning point income level.Social implicationsFurthermore, education is one of the critical determinants that have an impact on FLFPR. The equal opportunity for both genders to engage in education should be considered as a policy. If females do not have an equal chance to enrolment in education, it may influence the policy of increasing female labour force adversely. Fertility rate appears no more statistically significant in our study. Moreover, today, there are some countries they practise equality between genders by providing equally extended parental leave, which may be a promising policy for gender equality in the labour force and may worth a try.Originality/valueSome previous studies may suffer model mistakes due to lack of consideration the endogeneity problem and bias issue of the results as suggested by Tam (2011). Moreover, previous studies tend to choose either studying U-feminisation as excluding other variables or studying determinants of female labour force participation rate as excluding U-feminisation theory. There is not any panel data study acknowledging both concepts by using recent data to the best knowledge of the authors. Thus, the novelty of this study is that the research not only employs both difference and system generalised method of moments (GMM) estimators but also includes main explanatory variables such as education, fertility, and total labour force rate. The study provides an opportunity to review the U-shape nexus between the female labour force and economic growth while controlling education, fertility and total labour participation rate.

THE IMPACT OF RENEWABLE ENERGY CONSUMPTION ON THE ECONOMIC GROWTH OF THE ASEAN COUNTRIES

The foremost purpose of the study is to explore the impact of renewable energy consumption (REC) on the economic growth of ASEAN countries. Data were extracted from the World Bank and ASEAN Energy Information Administration (EIA). The “Generalized Method of Moments (GMM)” approach has been used by using the STATA software for the analysis. The results unprotected that the REC and non-renewable energy consumption (NREC), growth in labor force and capital stock has positive nexus with the economy growth of the ASEAN countries. These findings provide the guidelines to the regulators that they should make the policies for the REC and NREC that increase the economy growth of the world.Keywords: Economy Growth, Renewable Energy, Non-renewable Energy, Growth of Capital, Growth of Labor Force, ASEAN countriesJEL Classifications: Q1, N7DOI: https://doi.org/10.32479/ijeep.10589

The Impact of Rand/Pula Exchange Rate Volatility on Botswana’s Economic Growth

This paper undertakes an investigation of the impact of the Rand/Pula exchange rate volatility on Botswana’s economic growth. The paper is using annual time series data, from 1977 to 2018. The Generalized Method of Moment (GMM) is employed to evaluate the impact of the real exchange rate volatility on Botswana’s economic growth. The GARCH model results found the Pula/Rand exchange rate to be volatile. The Rand/Pula exchange rate volatility does not have an impact on Botswana’s economic growth. This finding mirrors those of Kaur et al. (2019) and Musyoki et al. (2012). They found negative but insignificant impact of exchange rate volatility on economic growth in Malaysia and Kenya, respectively. Our empirical findings suggest that Botswana’s economic growth is largely explained by trade openness and growth of labour force and not influenced by the Rand/Pula exchange rate volatility.

MILITARY AND DEMOGRAPHIC INTER-LINKAGES IN THE CONTEXT OF THE LITHUANIAN SUSTAINABILITY

This paper aims at investigating military and demographic inter-linkages in the context of the Lithuanian sustainability. The investigation combines three important economic aspects such as demographic, military and sustainable development. The authors have revealed that demographic trends should be seen as a necessary conditions for ensuring the functioning of the military sector contributes to public security and sustainable development in general. Correlation and stepwise regression analysis, also Monte Carlo forecasting method have been applied for this purpose. Research results have revealed statistically significant interrelationship between military personnel as a share of total labour force and population growth rate, population median age, total fertility rate as well as birth rate. Moreover, Monte Carlo forecasting method allowed revealing for the next 10 years a steady slight increase in armed forces personnel, stable population growth rates, a rapid aging process and a slight decline of total fertility rate. Military and demographic estimations and future projections allow government to incorporate information into planning and sustainable development policy. The insights from this research may contribute to implementing the goals of sustainable development related to eradication of poverty, inequality, social exclusion, improvement in education, well-being and employment and tackling climate change.

Integration of refugees: the interactive dynamics of health, education and employment

Abstract Background Host countries have a great interest in the integration of refugees to decrease spending on social welfare services, increase social coherence and secure the labour force and economic growth. While recent political trends in the Nordic countries have been focusing on “employability” as a key to integration, the outcomes from education and employment on health has been less considered. The presentation sets the scene for the Nordic comparative research on refugee children and youth and motivates the focus on the interrelatedness of health, education and employment Methods The presentation will draw on existing theories and empirical literature as well as CAGE findings from comparative quantitative analysis of register data and qualitative studies based on interviews and observations. Results Socio-economic conditions impact health through many interrelated pathways, including risk and protecting factors in both the country of birth and in the host country, as well as age at migration. But poor health may also impair education and entry into the labor market, which is particularly relevant for the refugee population. Using a life course framework, the introduction will shed light on this interrelatedness reflected in the evidence from CAGE. Since varying welfare policies may shape the integration and life chances of young refugees in the Nordic countries differently, the gain of investigating this interrelatedness through Nordic comparisons will be underscored. Conclusions Welfare policies related to refugees need to take into account the interrelations between inclusive health care, successful education and entrance into the labour markets. Adapted educational programmes to catch-up with the majority population, training of integration officers at the local level and diversity competent health services may explain successful integration and give young refugees better life chances in exile.

Evaluating the potential of Estonia as European REE recycling capital via an environmental social governance risks assessment model✰

The rare earth elements (REEs) are cornerstone metals of modern society and are used in many applications. Europe is dependant on other continents for the safe supply of rare earth elements as these are to date not mined in Europe. In order to circumvent the shortage of supply, the rare earth elements recycling, especially from End-of-Life (EoL) products are imperative. This article evaluated the feasibility of Estonia as viable REEs recycling hub in Europe via an environmental, social and governance risks evaluation model. The model assessed the pros and cons of Estonia`s environmental, social and governance indicators, and concluded that Estonia is very suitable for the establishment of REEs recycling industry. The environmental indicators showed continuous improvement in environmental health. The Estonian education system is of excellent quality and has produced a highly skilled workforce over the past years. The country's economic indicators are good, management is transparent and business opportunities are diverse. The environmental, social and governance situations show that Estonia mostly meets the prerequisites for the establishment of a rare earth element recycling industry. The existence of such business will increase the quality of the labour force and economic growth in the long term.

The Real Exchange Rate Regime and Economic Growth in Ghana

An empirical research that aims at investigating the interplay between real exchange rate and economic growth is imperative in the study of modern international economics. The real exchange rate regime plays a critical role in the economic growth of a country. The research focusses on the interaction that exist between Real Exchange Rate and Economic Growth in Ghana. Real GDP was used as a measure of Economic Growth Rate. Results from the empirical analysis revealed a statistically significant and positive association existing between real exchange rate and the growth of Ghana’s economy (Real GDP). This affirms the major hypothesis. Results from the data analysis also showed a statistically significant and positive association between labour force and economic growth. Results from the analysis also revealed an inverse relation between government’s consumption expenditure patterns and economic growth. The study finally considered the theoretical and practical contributions of the study.

Banking, labor force, and regional economic growth: Evidence from Indonesia

This paper examines whether regional economic growth across Indonesian provinces can be affected by the role of banking and labor force. In general, our empirical findings show that banking development is indeed positively linked to regional economic growth, although this relationship is more pronounced for poor provinces. Moreover, this paper finds that the link between banking development and regional economic growth is conditional on the degree of labor force. Specifically, the positive impact of banking on regional economic growth only occurs when labor force is sufficiently low regardless of whether we observe poor provinces or rich provinces. Eventually, this paper highlights that increasing access to bank credit is essential to boost regional economic growth, especially for poor provinces or provinces with lower labor force. JEL Classification: O16, G21, G28 How to Cite: Razak, A. R., Soedarmono, W., Yudhi, W. S. A. (2020). Banking, labor force,and regional economic growth: Evidence from Indonesia. Jurnal Keuangan dan Perbankan, 24 (2), 156-163. DOI : https://doi.org/10.26905/jkdp.v24i2.3533

Digital Debt Labour: Migration, Deportation and Offshoring in Mexico

This article explores the convergence of debt, deportation, and digital labour in Mexico by describing the making of a labour force working on the frontlines of transnational debt collection, performing what we call digital debt labour. Drawing on dozens of interviews in Tijuana and Mexico City conducted between 2016 and 2019, we relate the growth of a debt collection labour force in Mexico. To theorise the intersection between debt, migration, and digital labour, this article explores three overlapping, converging, and expanding forms of migration: debt migration, or the circulation of consumer credit through markets for, or processes of, debt collection; virtual migration or the outsourcing of call centre work to offshore locations and the return migration of call centre workers in the labour process; and forced migration, or the deportation of undocumented migrants. Our core argument is that this case study demonstrates the manner in which a highly financialised and digital variant of capitalism is evolving to develop a multi-faceted and opportunistic relationship with the growing trends of migration and deportation.

Review of National Employment Policy of Ethiopia: Reference to Labor Proclamation 1156/2019

DOI: 10.7176/PPAR/10-3-03 Publication date: March 31 st 2020 1. Introduction A policy is a definite course or method of action selected (by government, institution, group or individual) from among alternatives and in the light of given conditions to guide and, usually, to determine present and future decisions (Webster's dictionary). Public Policy is a statement by government on what it intends to do or not to do such as law, regulation, decision or order, or a combination of these that govern a particular issue areas or problem (Birkland, 2001:9). Public policy may refer to what government intends to do to achieve certain goals. This definition makes public policy look like a mere decision. That is to say that mere declaration of intentions, wishes, principles, or expression of desires cannot be called public policy. Public policy should mean actual resource allocation presented by projects and programs designed to respond to perceived public problems and challenges requiring government action for their solution. That is, it should mean hard patterns of resource allocation presented by projects and programs designed to respond to perceived public demands. This conception of public policy can be identified with a political scientist, James E. Anderson who defines policy as a relatively stable, purposive course of action followed by an actor or set of actors in dealing with a problem or a matter of concern (Anderson, 1997). This statement focuses on what is actually done instead of what is only proposed or intended, and it differentiates a policy from mere decision, which is essentially a choice among competing alternatives. Public policy, therefore, is that policy developed and implemented by government agency and officials, though non-state actors and factors may influence its process. A country like Ethiopia with abundant labor force is, thus, required of to have a right employment policy in place in order to effectively use its growing labor force in a productive manner. In this regard the country is exerting efforts to make sure that new entrants to the labor force are equipped with the necessary knowledge, skill, and attitude that the economy needs. Micro and Small Enterprises have strategic relevance for employment creation, poverty reduction, rural-urban linkages, and for the growth of the private sector. A considerable number of permanent and temporary employment opportunities are being created as a result of the appropriate investment policy of the country attracting the private sector and also due to public investments especially in infrastructure, urban development, and housing construction.

How Does Immigration Fit into the Future of the U.S. Labor Market?

U.S. GDP growth is anticipated to remain sluggish over the next decade, and slow labor force growth is a key underlying reason. Admitting more immigrants is one way U.S. policymakers can bolster growth in the workforce and the economy. A larger role for immigrant workers also can help mitigate other symptoms of the economy’s long-run malaise, such as low productivity growth, declining domestic geographic mobility, and falling entrepreneurship, as well as help address the looming mismatch between the skills U.S. employers want and the skills U.S. workers have. While some might argue that technological change and globalization mean there is less need to admit immigrant workers, such arguments fail to account for both recent data and historical experience. Of course, immigration—like anything else—is not without costs, which are disproportionately borne by the least educated. A plan to increase employment-based immigration as a way to spur economic growth could be paired with new programs to help low-skilled U.S. natives and earlier immigrants so that the benefits of immigration are shared more equitably.

What happened to the world's potential growth after the 2008–2009 global financial crisis?

This paper provides estimates of potential growth for 52 economies in 2000–2018. We follow Borio et al.’s (2014, 2017) methodology, which takes into account the relationship between financial factors and the output gap. We find that the world's potential growth declined from an average of 3.0% in 2000–2007 to 2.6% in 2010–2018. Potential growth peaked before the crisis at 3.4% in 2006. The trough was in 2009 at 2.3%. Potential growth started recovering in 2010 and reached 2.9% in 2018. Decomposing the 0.4 percentage points decline between 2000–2007 and 2010–2018 by economy, we find that high-income Europe contributed 0.34 percentage points. The decline in potential growth in the United States contributed 0.24 percentage points, while the decline in Japan contributed just 0.07 percentage points. China's potential growth and that of Asia and the Pacific also fell, but their contributions to the change in the world's potential growth were positive, 0.33 percentage points and 0.11 percentage points, respectively. The other economies contributed 0.19 percentage points to the decline. Decomposing the sources of the decline into the contributions of labor force growth and labor productivity growth, the former declined by 0.55 percentage points, while labor productivity growth increased by 0.15 percentage points.

THE IMPACT OF INSTITUTIONS ON SERVICES EXPORTS OF CENTRAL AND EASTERN EUROPEAN COUNTRIES

Besides labor, capital and technology, institutions are another important factor of production and exports. They set a framework of motivation for economic activities and their efficiency. The previous research provided evidence for the effect of institutions on international trade and development. This paper focuses on the effect of institutional progress on export competitiveness of several services sectors in Central and Eastern Europe in the post-crisis period (2011-2017). In the analyzed period the services exports growth turned out to be more stable than the goods exports growth. The multi-country models showed that several types of institutional improvements affected the exports growth in the medium run. Excluding outliers, using weighted enlarged sample and alternative method for measuring exports growth were applied to assess robustness of the research results. Labor force growth, GDP and GDP per capita were initially used as control variables, but in most cases their effect for exports growth was insignificant in Central and Eastern Europe. Sector specific approach to the analysis turned out to be the most effective to understand the transmission mechanism of the effect under the situation of services heterogeneity. Monetary freedom (currency stability and market-based prices) stimulates exports of transport services. The rule of law (contract enforcement, property rights, efficiency of police and courts, absence of crime and violence etc.) is important for raising international tourism receipts. Information and communication technologies services exports depend primarily on voice and accountability (democratic principles, respects human rights and free media). As for financial and insurance services exports, no significant institutional factor was found. Control of corruption, political stability, labor freedom, government integrity, government effectiveness and lower government size also may be important, but their effect is not robust or cannot be distinguished from the effect of the abovesaid factors. It is more likely that fighting corruption may have a positive impact on the services exports than on the goods exports. The latter depend positively on the level of investment freedom. Using the selected EU Member States in Central and Eastern Europe as a benchmarking level enabled us to estimate a potential effect for services exports in case of Ukraine if it reaches their level of institutional development. In particular the institutional progress can boost Ukrainian transport, tourism, information and communication technologies services exports by 30-200% or by 10-15% of its GDP.

Determinants of Recent Economic Growth in Ethiopia

This study tried to identify the major sources of recent economic growth in Ethiopia for the last thirty three years starting from the year 1980 up to 2013. The study has been under taken with the use of both econometric and descriptive analysis techniques and various diagnostic tests like stationary test (by using augmented dicky-fuller test), multicollinearity test by using vif test), heteroscedasticity test (by using Breusch-pagan test), omitted variable (by using ov-test) both in the lung-run and short-run effect of independent variables on dependent variable. In addition, tables, figures and graphs were used. The study employed time series data for both the dependent (RGDP) and independent variables. The explanatory variables including domestic investment, labor force growth, real effective exchange rate, remittance and corruption were investigated. The analysis is carried out through an extensive review of relevant literature and macroeconomic model of economic growth. The findings show that growth in Ethiopia is positively affected by domestic investment, labor force growth, and remittance. Therefore, the study recommended that increasing domestic investment through promoting public and private sectors, effective use of the growing labor force and proper use of remittance for capital formation and distribution over all sectors as the directions to achieve rapid and sustainable economic growth in Ethiopia.

Divergence in Labour Force Growth: Should Wages and Prices Grow Faster in Germany?

We develop a model which shows that wages, prices and real income should grow faster in countries with low increase in their labour force. If not, other countries experience growing unemployment and/or trade deficit. This result is applied to the case of Germany, which has displayed a significantly lower increase in its labour force than its trade partners, except in the moment of the reunification. By assuming that goods are differentiated according to their country of origin (Armington’s hypothesis), a low growth of the working population constrains the production of German goods, which entails an increase in their prices and in German wages. This mechanism is magnified by the low price elasticity of the demand for German goods.Hence,the German policy of wage moderation could severely constrain other countries’ policy options. The simulations of an extended model which encompasses offshoring to emerging countries and labour market imperfections suggest that (i) the impact of differences in labour force growth upon unemployment in Eurozone countries has been significant and (ii) the German demographic shock following unification could explain a large part of the 1995-2005 German economic turmoil.

The Impact of Domestic and External Public Debt on the Economic Growth of Jordan

Since the beginning of the new millennium several developing countries have been making greater use of domestic bond markets, with a corresponding decline in gross and net foreign debt-to-GDP ratios. Jordan was not an exception; the structure of the public debt in Jordan has exhibited a similar shift towards the domestic borrowings after the year 2000. In order to assess the economic consequences of this change in the public debt structure, this study investigates the impact of the structure of the public debt and other determinants of growth on the economic growth in Jordan over the period 1980 – 2018. The analysis of the long-run relationship between the domestic and external public debt and the economic growth is reliant on the theoretical assumptions and the empirical concerns and it is conducted by applying the Fully Modified Ordinary Least Squares (FMOLS) method; the results indicate that the external and domestic public borrowings are negatively associated with economic growth with a greater magnitude of the domestic debt in the long-run; the greater magnitude of the negative implication of domestic debt on economic growth is attributed to the increased trend of domestic debt that has been increasing in excess of the external debt since 2008. On the other hand, investment, labor force growth, and openness of trade are found to be positively associated with economic growth in the long-run. Accordingly, this study recommends the need to reduce the public debt and budget deficit to moderate levels in the long-run through implementing austerity measures and fiscal discipline that are carefully planned to minimize the potential negative effect on economic growth, where they should be implemented along with fiscal reforms intended for increasing employment and boosting Jordan’s growth potential. It is also recommended that the government should thoroughly revise the debt management strategy, so as to avoid the deterring effects of the increased stock of domestic debt on capital accumulation and economic growth in the long-run.

Agriculture Sector Growth and Inflation in Ethiopia: Evidence from Autoregressive Distributed Lag Model

There is cross country difference about the relationship between economic growth and inflation. Although the issue is the most researched topic, limited studies were undertaken at sectoral level, such as the relationship between inflation and agriculture sector growth. Therefore, this study examines the effect of inflation on agriculture sector growth of Ethiopia from 1980-2018 using Autoregressive Distributed Lag model. Inflation has negative and significant long-run relation with agriculture sector growth suggesting that inflation is harmful to agriculture sector growth than stimulating it. Other regressors such as total factors productivity, arable land and labour force growth have positive and significant long-run relationship with agriculture growth. In the short run, the growth of agriculture sector has positive and significant relationship with its lagged value, capital, labour force, factors productivity, inflation and exchange rate. Thus, to increase the growth of agriculture sector, government should moderate inflation using prudent monetary and fiscal policy. It should also monitor the efficacy and suitability of agriculture investment to countries context. As land is fixed input, intensive agriculture and productivity enhancing technologies should be applied. Increasing labour skill through training could also increase agriculture output.