Is There an Informal Employment Wage Penalty in Egypt? - Economic Research Forum (ERF)

Is There an Informal Employment Wage Penalty in Egypt?

Aysit Tansel, Halil Ibrahim Keskin and Zeynel Abidin Ozdemir

December, 2015


37 pages

J4. Particular Labor Markets
J2. Demand and Supply of Labor

This paper considers the private sector wage earners in Egypt and examines their wage distribution during 1998-2012 using the Egyptian Labor Market Panel Survey. We first estimate Mincer wage equations both at the mean and at different quantiles of the wage distribution taking into account observable characteristics. Then we make use of the panel feature of the data and estimate models taking into account unobservable characteristics. We also consider the possibility of nonlinearity in covariate effects and estimate a variant of matching models. In all cases we find a persistent informal wage penalty in the face of extensive sensitivity checks. It is smaller when unobserved heterogeneity is taken into account and larger at the top than at the bottom of the conditional wage distribution. We also examine the informal wage penalty over time during the study period and in different groups according to experience and education. The informal wage penalty has increased recently over time and is larger for the better educated but smaller for the more experienced.




 تناقش هذه الورقة الأجراء في القطاع الخاص في مصر وتدرس توزيع الرواتب والأجور خلال 1998-2012 باستخدام المسح التتبعى لسوق العمل المصرى. قمنا أولا تقدير معادلات الأجور على حد سواء في الوسط وعلى نسب مختلفة من توزيع الأجور مع الأخذ بعين الاعتبار الخصائص التي يمكن ملاحظتها. نقوم أيضا بمناقشة إمكانية الاستقامة في آثار المتغيرات وتقدير البديل من نماذج مطابقة. في جميع الحالات نجد أن الأجور الرسمية في حالة عقاب مستمرة في مواجهة المتحققات الحساسة واسعة النطاق. وعندما نأخذ في الاعتبار عدم التجانس غير الملحوظ وأكبر مما كانت عليه في الجزء السفلي من توزيع الأجور المشروط. نقوم أيضا بفحص عقوبة الأجور غير رسمية مع مرور الوقت خلال فترة الدراسة وجماعات مختلفة وفقا للخبرة والتعليم. وزادت عقوبة الأجور الرسمية مؤخرا بمرور الوقت للأفضل تعليما ولكن أصغر للأكثر خبرة


Research Fellows

Aysit Tansel

Professor, Middle East Technical University, Turkey


Halil Ibrahim Keskin

Cukurova University, Turkey

Research Fellows

Zeynel Abidin Ozdemir

Professor of Economics, Gazi University



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