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Title: Essays on labour market frictions in developing countries
Author: Franklin, Simon
ISNI:       0000 0001 0905 7378
Awarding Body: University of Oxford
Current Institution: University of Oxford
Date of Award: 2015
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This thesis is about imperfections in urban labour markets of three developing countries. I study how physical living conditions place constraints on labour force participation, and increase risks associated with unemployment. In Chapter One I test for the impact of high search costs on labour market outcomes of job seekers. I use a randomized trial of transport subsidies among youth living far away from the centre of the city in Addis Ababa, Ethiopia. Lowering transport costs increases the intensity of job search and leads to better employment outcomes. Weekly phone call data shows that treatment works to stop job search activity from declining over time. I show that the results are consistent with a dynamic model of job search with cash constraints and monetary search costs. Income from temporary work is used to smooth consumption and pay for the costs of search. I find that subsidies reduce participation in temporary work. Chapter Two looks at the links between poor housing conditions in slums and market labour supply. I test for the effect of free government housing in South Africa on households, using four waves of panel data and a natural experiment due to the allocation of new housing according to proximity from housing projects. I then use planned but cancelled projects to control for non-random selection of housing project sites. I find that government housing leads to large increases in household incomes from wage work, and increases in the labour supply of female household members. I argue that these results are due to reduced burdens of work in the home of improved housing, especially for women. In Chapter Three we look at how labour markets respond to large but temporary economic shocks caused by typhoons in the Philippines. We use quarterly aggregate, repeated-cross sectional and panel data to demonstrate robust evidence of downward wage flexibility. Lay-offs do not occur when storms hits, but hours per worker fall. We explain these results with a model of implicit contracts under which risk is shared between workers and firms through wage cuts, but workers are insured against lay-offs so that adjustments in labour demand occur through reductions in hours per worker. Our results are particularly strong for workers in long term contractual relationships in the private sector.
Supervisor: Fafchamps, Marcel ; Quinn, Simon Sponsor: Not available
Qualification Name: Thesis (Ph.D.) Qualification Level: Doctoral
EThOS ID:  DOI: Not available
Keywords: Development economics ; Labor market--Ethiopia ; Labor market--South Africa ; Labor market--Philippines ; Housing--Economic aspects--Developing countries ; Unemployment--Developing countries