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AuthorKamar B.
AuthorBakardzhieva D.
AuthorGoaied M.
Available date2020-04-23T14:21:35Z
Publication Date2019
Publication NameApplied Economics
ResourceScopus
ISSN36846
URIhttp://dx.doi.org/10.1080/00036846.2019.1591596
URIhttp://hdl.handle.net/10576/14396
AbstractThe main objective of our research is to study the direct impact of pro-growth economic policies on employment creation globally and regionally, as evidence has countered policy-makers’ expectation that output growth leads automatically to job creation. We innovate by using the ratio of employment to the population above 25 years as dependent variable instead of the customary employment elasticity. We apply generalized methods of moments’ econometrics on dynamic panel data models and find that growth stimulates employment creation on average across 76 countries. The policies promoting private sector credit, investments, openness, services, education spending, tertiary enrollment, and a fixed exchange rate are the ones that create employment. Larger government size undermines job creation, while policies promoting FDI and industrial development fail to stimulate employment. However, we establish that the effect of pro-growth policies on employment varies significantly across regions, with evidence of weaker links between economic policies and employment in Sub-Saharan Africa and the Middle East.
SponsorThe authors acknowledge the financial assistance of the European Commission within the context of the FEMISE research program (project FEM35-12) for preliminary work on this research. The contents of this document are the sole responsibility of the authors and can under no circumstances be regarded as reflecting the position of the European Union.
Languageen
PublisherRoutledge
Subjecteconomic growth
economic policies
Employment creation
regional disparities
TitleEffects of pro-growth policies on employment: evidence of regional disparities
TypeArticle
Pagination4337-4367
Issue Number40
Volume Number51


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