@article{Robalino:332791,
      recid = {332791},
      author = {Robalino, David and Weber, Michael},
      title = {Simulations of Labor Policies in Tunisia with a Structural  Job-Search Model},
      address = {2016},
      year = {2016},
      note = {Presented at the 19th Annual Conference on Global Economic  Analysis, Washington DC, USA},
      abstract = {We build a job-search model to assess the impacts of core  labor market policies on labor market outcomes and public  expenditures. The model assesses possible outcomes of  regulations on labor markets focusing on labor costs,  take-home pay, and the ’value’ of unemployment. We  formalize the behaviors of heterogeneous agents in a  dynamic setting. The model simulates career histories and  wages of individuals, tracking transitions between the  following labor market states: unemployment, formal wage  employment, informal wage employment, and self-employment.  To this end, the model simulates: (i) the process by which  workers find job opportunities; (ii) the wage bargaining  process; (iii) employers’ decisions to offer formal or  informal contracts; and (iv) workers’ decisions to accept  job offers, engage in self-employment, or remain  unemployed. Contrary to other models used in policy  analysis, we directly estimate structural parameters using  labor force survey data. To this end, a numerical algorithm  is used to find a set of model parameters that match the  following moments: the unemployment rate; the shares of  employment in formal wage, informal wage, and  self-employment, as well as the average and variance of  wages in each of these sectors. Important contributions of  this work are (i) the specific inclusion of the informal  sector and self-employment in the estimation of the effects  of labor policies, (ii) a numerical solution to the search  model that enables modeling multiple labor policies in one  dedicated simulation tool, and (iii) an algorithm that  determines model parameters for central moments of the  distribution of key labor market outcomes. Simulations for  the case of Tunisia demonstrate that labor policies can  have significant effects on the structure of the labor  market. It shows that it is possible to identify and  communicate labor policies that better balance workers'  protections with improved employment outcomes and  sustainable public expenditures.},
      url = {http://ageconsearch.umn.edu/record/332791},
}