Jellal, Mohamed and Zenou, Yves (2006): Ethnic diversity market structure and risk sharing in developing countries. Published in: Research in Labor Economics No. Vol 24, 397-426
Download (453kB) | Preview
The paper addresses mainly three questions. One, do workers tend to be employed by employers of the same ethnic group; two, what is the structure of the equilibrium wage contract, and three, do more ethnically homogeneous labor markets tend to have different labor contracts than more ethnically diversified ones. The answer to the first question is in the affirmative - in equilibrium all employers offer the same wage contract and workers are hired by employers of the closest ethnic affiliation. In terms of the equilibrium wage contract, its nature depends on the attitude towards risk of both sides of the market. Finally, the answer to the third question is also in the affirmative since the more homogenous the labor market, the more deterministic is the wage.
|Item Type:||MPRA Paper|
|Original Title:||Ethnic diversity market structure and risk sharing in developing countries|
|Keywords:||Ethnicity, sharecropping, piece rates|
|Subjects:||J - Labor and Demographic Economics > J4 - Particular Labor Markets > J43 - Agricultural Labor Markets
J - Labor and Demographic Economics > J7 - Labor Discrimination > J71 - Discrimination
J - Labor and Demographic Economics > J3 - Wages, Compensation, and Labor Costs
L - Industrial Organization > L1 - Market Structure, Firm Strategy, and Market Performance
|Depositing User:||Mohamed Jellal|
|Date Deposited:||30. Apr 2012 02:04|
|Last Modified:||24. Jul 2015 19:42|
 Ackerberg, D. and M. Botticini (2002), “Endogenous matching and the empirical determinants of contract form,” Journal of Political Economy,110, 564-591.
 Assaad, R. (1997), “Kinship ties, social networks and segmented labor markets: Evidence from the construction sector in Egypt,” Journal of Development Economics, 52, 1-30.
 Baland, J-M., J.P. Dr`eze and L. Leruth (1999), “Daily wages and piece rates in agrarian economies,” Journal of Development Economics, 59, 445-461.
 Bardhan, P.K. (1984), Land, Labor and Rural Poverty: Essays in Development Economics, New York: Columbia University Press.
 Bardhan, P.K. and A. Rudra (1981), “Terms and conditions of labour contracts in agriculture: Results of a survey of West Bengal 1979,” Oxford Bulletin of Economics and Statistics, 43, 89-111.
 Barr, A. and A. Oduro (2002), “Ethnic fractionalization in an African labour market,” Journal of Development Economics, 68, 355-379.
 Barro, R. (1991), “Economic growth in a growth section of countries,”Quarterly Journal of Economics, 106, 407-443.
 Bates, R.H. (2000), “Ethnicity and development in Africa: A reappraisal,”American Economic Review, Papers and Proceedings, 90, 131-134.
 Bigsten, A., Collier, P., Dercon, S., Fafchamps, M., Gauthier, B., Gunning,J.W., Oduro, A., Oostendorp, R., Pattillo, C., S¨oderbom, M., Teal, F. and A. Zeufack (2003), “Risk sharing in labour markets,” World Bank Economic Review, 17, 349-366.
 Binswanger, H.P. and M.R. Rosenzweig (1982), Rural Labor Markets in Asia: Contractual Arrangements, Employment and Wages, New Haven: Yale University Press.
 Borjas, G.J. (1999), Heaven’s Door. Immigration Policy and the American Economy, Princeton: Princeton University Press.
 Cheung, S.N. (1969), The Theory of Share Tenancy, Chicago: Chicago University Press.
 Chiappori, P-A. and B. Salani´e (2003), “Testing contract theory: A survey of some recent work”, in Advances in Economics and Econometrics. Theory and Applications, EighthWorld Congress, M. Dewatripont, L. Hansen and P. Turnovsky (Eds.), Econometric Society Monographs, Cambridge University Press, Cambridge, pp. 115-149.
 Chiswick, B.R. (1978), “The effect of Americanization on earnings of foreign-born men,” Journal of Political Economy, 86, 897-921.
 Chiswick, B.R. and P.W. Miller (1996), “Ethnic networks and language proficiency among immigrants,” Journal of Population Economics, 9, 19-35.
 Collier, P. and J.W. Gunning (1999), “Explaining African economic performance,” Journal of Economic Literature, 37, 64-111.
 Dr`eze, J.P. and A. Mukherjee (1989), “Labour markets in rural India: Theories and evidence,” in The Balance Between Industry and Agriculture in Economic Development, S. Chakravarty (ed.), London: Macmillan Press.
 Dustman, C. and I. Preston (2001), “Attitudes to ethnic minorities, ethnic context and location decisions,” Economic Journal, 111, 353-373.
 Easterly, W. and R. Levine (1997), “Africa’s growth tragedy,” Quarterly Journal of Economics, 112, 1203-1250.
 Esteban, J. and D. Ray (1994), “On the measurement of polarization,” Econometrica, 62, 819-851
 Eswaran, M. and A. Kotwal (1985), “A theory of contractual structure in Agriculture,” American Economic Review, 75, 352-367.
 Fafchamps, M. (1996), “The enforcement of commercial contracts in Ghana,” World Development, 24, 427-448.
 Foster, A. and M. Rosenzweig (2001), “Imperfect commitment, altruism, and the family: Evidence from transfer behavior in low-income rural areas,” Review of Economics and Statistics, 83, 389-407.
 Krishnan, P. and E. Sciubba (2004), “Endogenous network formation and informal institutions in village economies,” Unpublished manuscript, University of Cambridge.
 Laffont, J-J. and M.S. Matoussi (1995), “Moral hazard, financial constraints and sharecropping in El Oulja,” Review of Economic Studies, 62,381-399.
 Lazear, E.P. (1995), Personnel Economics, Cambridge: The MIT Press.
 Lazear, E.P. (1999), “Culture and language,” Journal of Political Economy,107, S95-S126.
 Mauro, P. (1995), “Corruption and growth,” Quarterly Journal of Economics,110, 681-712.
 McIntosh, J. (1984), “An oligopsonistic model of wage determination in agrarian societies,” Economic Journal, 94, 569-579.
 Miguel, E. and M.K. Gugerty (2005), “Ethnic diversity, social sanctions, and public goods in Keyna,” Journal of Public Economics, forthcoming.
 Modood, T., Berthoud, R., Lakey. J., Nazroo, J., Smith, P. Virdee, S.and S. Beishon (1997), Ethnic Minorities in Britain: Diversity and Disadvantage, London: Policy Studies Institute.
 Montalvo, J.G. and M. Reynal-Querol (2005), “Ethnic diversity and economic development,” Journal of Development Economics, 76, 293-323.
 Newberry, D.M. and J.E. Stiglitz (1979) , “Sharecropping, risk sharing and the importance of imperfect information,” in Risk, Uncertainty and Agricultural Development, J.A. Roumasset, J.M. Boussard and I. Singh (eds.), New York: Agricultural Development Council.
 Pandey, P. (2002), “Effect of technology on incentive design of share contracts,” Unpublished manuscript, Pennsylvania State University.
35] Sadoulet, E., Fukui, S. and A. de Janvry (1994), “Efficient share tenancy contracts under risk: The case of two rice-growing villages in Thailand,” Journal of Development Economics, 45, 225-243.
 Sadoulet, E., de Janvry, A. and S. Fukui (1997), “The meaning of kinship in sharecropping contracts,” American Journal of Agricultural Economics,79, 394-406.
 Salop, S.C. (1979). “Monopolistic competition with outside goods,” Bell Journal of Economics, 10, 141-156.  Sandmo, A. (1971), “On the theory of the competitive firm under price uncertainty,” American Economic Review 61, 65-73.
 Shaban, R. (1987), “Testing between competing models of sharecropping,” Journal of Political Economy, 95, 893-920.
 Stiglitz, J.E. (1974), “Incentives and risk sharing in sharecropping,” Review of Economic Studies, 41, 219-255.
 Taylor, C.L. and M.C. Hudson (1972), World Handbook of Political and Social Indicators, Second Edition, New Haven, CT: Yale University Press.
 Udry, C.R. and T.G. Conley (2004), “Social networks in Ghana,” Economic Growth Center Discussion Paper No. 888, Yale University.
 van de Walle, D. and D. Gunewardena (2001), “Sources of ethnic inequality in Viet Nam,” Journal of Development Economics, 65, 177-207.
 Wahba, J. and Y. Zenou (2005), “Density, social networks and job search methods: Theory and application to Egypt,” Journal of Development Economics, forthcoming.
 Wilson, D.C. (1998), “Markets, networks, and risk: An analysis of labor remuneration in the Lake Victoria fishing industry,” Sociological Forum,13, 425-456.