Econometrics II

Semester: 
Spring
Selwaness, I., and C. Krafft, "The dynamics of family formation and women’s work: what facilitates and hinders female employment in the Middle East and North Africa?", Population Research and Policy Review: Springer, pp. 1-55, 2020. Abstract
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Alhawarin, I., and I. Selwaness, "The Challenges of Social Security Coverage and Early Retirement in Jordan", The Jordanian Labor Market: Between Fragility and Resilience: Oxford University Press, pp. 313, 2019. AbstractWebsite

Jordan has undergone a profound social security reform since 2010, primarily aiming to ensure the financial sustainability of the system over time. Using data from the 2010 and 2016 Jordan Labor Market Panel Survey (JLMPS), this chapter examines the dynamics of Jordanian workers’ access to social security and trends in early retirement incidence before and after the reform. The chapter also explores the time it takes to acquire social security coverage on the labor market before and after the reform. Our findings show that the overall incidence of social insurance coverage slightly increased in 2016, for private sector wage workers, irregular wage workers, and non-wage workers (employers and self-employed). Public sector employees were the most likely to acquire social insurance coverage at the start of their jobs, followed by the private sector wage workers inside establishments. Both men and women who started their first job after the 2010 reform experienced a decline in their probability of acquiring social insurance coverage upon their job start. Moreover, the average incidence of early retirement slightly declined among men while still being highly prevalent around ages 40–46.

Selwaness, I., and M. Messkoub, "The Egyptian Social Protection System: Coverage Gaps, Challenges and Opportunities", Social Policy in the Middle East and North Africa: The New Social Protection Paradigm and Universal Coverage, Cheltenham, Edward Elgar Publishing, 2019. Abstract

There is an urgent need to address the shortcomings of Egypt’s current social protection system as part of a new social contract between the state and its citizens. With Egypt in a state of economic instability and recent efforts to reform the social insurance system stalled, the aim of this article is to provide a review of social insurance (SI) and social assistance (SA) systems, particularly in terms of coverage of population and benefits adequacy. Our findings show that a large and increasing proportion of workers are without social security coverage. This is because of the expansion of informal employment reaching up to 75 per cent of private sector wage employment and around 85 per cent of non-wage employment. Such a shortfall of coverage is particularly pronounced among young workers aged 20-29, younger headed households and workers in rural areas. The economically vulnerable workers, who are the largest proportion of all workers and are in the lower wealth quintiles of population, are less likely to be enrolled in the social security system and will not receive any pension in their old-age. This SI coverage gap is combined with the failure of SA programmes to reach a large percentage of the poor. The SA benefits to poor also suffer from an adequacy problem where, in 2012, the average social assistance income represented around 6.6 per cent of the “very poor” and 4.4 per cent of the “poor” poverty line. While there have been some reform measures to increase pensions, the inflationary wave hitting the Egyptian economy would erode SA pensions and raise headcount poverty rate. These challenges have called into question the efficacy of the current social protection system and the state’s ability to provide for its citizens’ basic welfare. A comprehensive reform of the social protection system in support of the poor and vulnerable should remain at the top of Egypt’s policy agenda.

Selwaness, I., and R. Roushdy, "Who Is Covered and Who Under‐reports: An Empirical Analysis of Access to Social Insurance in Egypt", Journal of International Development, vol. 31, issue 8, pp. 720-751, 2019. Abstract

This paper investigates the dynamics and determinants of having access to social insurance coverage on the Egyptian labour market among wage and non‐wage workers. The paper explores two issues: the worker‐level and firm‐level determinants of having access to social insurance and the risk of under‐reporting insurable wage to the social security authority. With the use of data from the Egyptian Labor Market Panel Survey of 2006 and 2012, the likelihood of being enrolled in social insurance is estimated by a probit regression model for all workers, for wage and non‐wage workers, separately. The potential endogeneity between the type of work and social insurance access is addressed using instrumental variables approach. Results show that men, older, married, better educated and white‐collar highly skilled workers are more likely to be socially insured. Under‐reporting insurable wages is positively correlated with working outside the establishment and basic monthly wage, while it is negatively correlated with tenure and white‐collar occupations. High contribution rates requested from both the employer and employee, combined with basing benefits on wage level of the last few years of service, and the weak capacity of law enforcement encourage employers and employees to either not participate in the social insurance system or contribute on amounts that are lower than their actual wage. This paper is one of the few studies that focus on the phenomenon of coverage gap and under‐reporting salaries to the social security administration.

Selwaness, I., and C. Zaki, "On the Interaction between Exports and Labor Market Regulation: Evidence from the MENA Countries", The Quarterly Review of Economics and Finance: Elsevier, 2018. AbstractWebsite

Using a panel of MENA countries, this paper aims to examine the interaction between exports performance and labor market regulations on employment levels. The theoretical predictions on this literature show that the effects of exports in any given country can be altered by the nature of labor market regulations. Previous studies showed that trade liberalization was more likely to have a positive impact on employment rates in countries with flexible labor markets and vice versa, mainly because of how the labor market adjustment process to trade openness occurs. Our main findings how that labor market rigidity reduces the positive impact of exports on employment. Indeed, rigid labor markets may limit the easiness of creating new jobs that satisfy the increased labor demand in expanding sectors when a country experience an increase in its exports.

Selwaness, I., and R. Roushdy, "Young People School-to-Work Transition in the Aftermath of the Arab Spring: Early Evidence from Egypt", International Journal of Manpower, vol. 40, issue 3: Emerald Publishing Limited, pp. 398-432, 2019. AbstractWebsite

The purpose of this paper is to examine the school-to-work transition of young people from subsequent school exit cohorts between 2001 and 2012 in Egypt, thus, presenting an early evidence on the adjustments of the labor market in terms of patterns of youth transition to a first job following the 2011 Egyptian uprising.

The analysis compares the early employment outcomes of those who left school after the January 25, 2011 uprising to that of those who left before 2011. The authors also separately control for the cohorts who left school in 2008 and 2009, in an attempt to disentangle any labor market adjustments that might have happened following the financial crisis, and before the revolution. Using novel and unexploited representative data from the 2014 Survey of Young People in Egypt (SYPE), the authors estimate the probability of transition to any first job within 18 months from leaving education and that of the transition to a good-quality job, controlling for the year of school exit. The authors also estimate the hazard of finding a first job and a good-quality job using survival analysis.

School exit cohorts of 2008–2009 (following the financial crisis) and those of 2011–2012 (in the aftermath of the 2011 uprisings) experienced a significantly higher likelihood of finding a first job within 18 months than that of the cohorts of 2001–2007. However, this came at the expense of the quality of job, conditional on having found a first job. The results of the hazard model show that school leavers after 2008 who were not able to transition to a job shortly after leaving school experienced longer unemployment spells than their peers who left school before 2007. The odds of finding a good-quality job appears to decline with time spent in non-employment or in a bad-quality first job.

This paper contributes to a limited, yet growing, literature on how school-to-work transition evolved during the global financial crisis and the Egyptian 2011 revolution. Using data from SYPE 2014, the most recent representative survey conducted in Egypt on youth and not previously exploited to study youth school-to-work transition, the paper investigates the short-term adjustments of the youth labor market opportunities during that critical period of Egypt and the region’s history.

Assaad, R., C. Krafft, and I. Selwaness, "The Impact of Early Marriage on Women’s Employment in the Middle East and North Africa", Economic Research Forum Working Papers, issue 1086, 2017. Abstract

Marriage is a central stage in the transition to adulthood in the Middle East and North Africa (MENA). This paper builds on the existing literature on the effect of marriage on women’s employment in MENA. Besides examining how different types of work are affected by early marriage (defined as marriage by the median age of marriage) in a multivariate setting, the contribution of this paper is to endogenize the marriage decision using an instrumental variable approach. We find that marriage by the median age reduces the probability of working for women by 47 percent in Jordan, 33 percent in Tunisia and 16 percent in Egypt. Much of the effect is due to a reduction in the probability of private wage work, which is reduced by 76 percent in Jordan, 57 percent in Tunisia and 40 percent in Egypt. Differences emerge across the three countries in the extent to which self-employment after marriage is available to women to compensate for the reduction in wage employment opportunities.

Selwaness, I., and C. Krafft, "The Dynamics of Family Formation and Women’s Work: What Facilitates and Hinders Female Employment in the Middle East and North Africa?", Economic Research Forum Working Paper Series No. 1192. Cairo, Egypt, 2018. Abstract

This paper investigates the dynamic relationship between family formation and women’s employment, a previously unexplored aspect of female labor force participation in MENA region. The paper studies Egypt, Jordan and Tunisia, leveraging unique retrospective data on work, marriage, child bearing and child rearing. The time variation allows us to estimate discrete hazard models for the duration of different labor statuses. This paper examines three sets of outcomes:(1) duration in employment,(2) duration in non-employment, and (3) duration in different labor market states and specific types of work. Findings show that anticipating marriage and childbearing are strongly associated with women’s employment outcomes. Non-employment is an absorbing state, particularly after marriage.

Alhawarin, I., and I. Selwaness, "The Evolution of Social Security in Jordan’s Labor Market: A Critical Comparison between Pre-and Post-2010 Social Security Reform", Economic Research Forum Working Paper Series No. 1185. Cairo, Egypt, 2018. Abstract

Jordan has undergone a profound social security reform since 2010, primarily aiming to ensure the financial sustainability of the system over time. The reform measures mainly included increasing the age of early retirement and the minimum contributions required to claim it, increasing employee and employer monthly contributions, covering even micro firms (with at least one employee), and allowing the self-employed and inactive housewives to voluntarily participate. Using data from the 2010 and 2016 Jordan Labor Market Panel Survey (JLMPS), this paper examines the dynamics of Jordanian workers’ access to social security before and after the 2010 reform and the coverage incidence across different firm sizes and workers’ characteristics. The paper also explores the time it takes to acquire social security coverage on the labor market before and after the reform. Moreover, trends in early retirement incidence among middle-aged male workers are examined. Our findings show that the overall incidence of social insurance coverage appears to slightly increase in 2016, for private sector wage workers, irregular wage workers, and non-wage workers (employers and self-employed). Workers starting in the public sector were the most likely to acquire social insurance coverage at the start of their jobs, followed by the private wage workers inside establishment. Both men and women who started their first job after the 2010 reform experienced a decline in their proportion of acquiring social insurance coverage upon their job start. Moreover, the average incidence of early retirement slightly declined among men while still being highly prevalent around ages 40-46.

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