Cover IMF Working Papers
Does Public-Sector Employment Fully Crowd Out Private-Sector Employment?
Author: Mr. Alberto Behar and Mr. Junghwan Mok
Series:
IMF Working Papers
Volume/Issue:
Volume 2013: Issue 146
Language:
English
Publication Date:
12 Jun 2013
DOI:
https://doi.org/10.5089/9781484329412.001
ISBN:
9781484329412
ISSN:
1018-5941
Pages:
38
Keywords:
WP; private sector; private-sector employment; Employment; Crowding out; Middle East and Central Asia; employment rate; crowding-out effect; C. private-sector employment; employment dataset; MENAP country; outcomes in the MCD; MCD country; employment equation; MCD countries' employment data; CCA country; labor force; Public employment; Employment rate; Government debt management; Unemployment; Middle East
Legal-disclaimer:
IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.
Download PDF (3.1 MB) Download Epub
We quantify the extent to which public-sector employment crowds out private-sector employment using specially assembled datasets for a large cross-section of developing and advanced countries, and discuss the implications for countries in the Middle East, North Africa, Caucasus and Central Asia. These countries simultaneously display high unemployment rates, low private-sector employment rates and high proportions of government-sector employment. Regressions of either private-sector employment rates or unemployment rates on two measures of public-sector employment point to full crowding out. This means that high rates of public employment, which incur substantial fiscal costs, have a large negative impact on private employment rates and do not reduce overall unemployment rates.
Cover IMF Working Papers
IMF Working Papers
ISSN:
1018-5941
Publisher:
International Monetary Fund