Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/22365
Authors: 
Günther, Isabel
Launov, Andrey
Year of Publication: 
2006
Series/Report no.: 
Würzburg economic papers 72
Abstract: 
It has been recently argued that the informal sector of the labor market in a developing economy shows a dual structure with one part of it being competitive to the formal sector and another part being the result of market segmentation. To test this hypothesis we formulate an econometric model which allows for a heterogeneous informal sector with unobserved individual a?liation and which takes into account selection bias induced by the employment decision of individ- uals. Our test results for the urban labor market in Cte d'Ivoire indeed show existence of both competitive and segmented employment in the informal sector.
Subjects: 
developing economy
informal labor market
segmentation
comparative advantage
selection bias
latent structure
finite mixture models
JEL: 
O17
J42
Document Type: 
Working Paper

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