The Response of Employment to Output Shocks in Egypt
Elroukh, A., Elsharkawy, R. (2023). The Response of Employment to Output Shocks in Egypt. EKB Journal Management System, 31(3), 64-84. doi: 10.21608/inp.2023.326509
Ahmed Elroukh; Rania Elsharkawy. "The Response of Employment to Output Shocks in Egypt". EKB Journal Management System, 31, 3, 2023, 64-84. doi: 10.21608/inp.2023.326509
Elroukh, A., Elsharkawy, R. (2023). 'The Response of Employment to Output Shocks in Egypt', EKB Journal Management System, 31(3), pp. 64-84. doi: 10.21608/inp.2023.326509
Elroukh, A., Elsharkawy, R. The Response of Employment to Output Shocks in Egypt. EKB Journal Management System, 2023; 31(3): 64-84. doi: 10.21608/inp.2023.326509

The Response of Employment to Output Shocks in Egypt

المجلة المصرية للتنمية والتخطيط
Volume 31, Issue 3, September 2023, Page 64-84  XML PDF (1.53 MB)
Document Type: المقالة الأصلية
DOI: 10.21608/inp.2023.326509
View on SCiNiTO View on SCiNiTO
Authors
Ahmed Elroukh* ; Rania Elsharkawy*
Lecturer – Department of Economics-Faculty of Economic Studies and Political Science- Alexandria University.
Abstract
This paper examines the response of employment to its own dynamics and output fluctuations using quarterly data that span the past two decades and an ARDL regression approach. This is the first paper that search empirically for the existence of a bounce-back effect in the response of employment to output in Egypt. We also test for inertia in the Egyptian labor market. The paper accounts for structural breaks that could have resulted due to the financial crisis, the political unrest following the 2011 revolution, and Covid-19 pandemic. The findings of this paper suggest the existence of a bounce-back effect in the response of employment to output and inertia in the Egyptian labor market. Moreover, the findings of this paper suggest the existence of adverse effects on employment of the recent shocks to the Egyptian economy. The magnitude of these effects differs according to the type of shock, though.
Keywords
Employment; Output Shocks; ARDL
References

References

  • Abdou, D., & Zaazou, Z. (2013). The Egyptian revolution and post socio-economic impact. Topics in Middle Eastern and African Economies, 15(1), 92–115.
  • Assad, R., Hendy, R., Assassin, M., & Yassin, S. (2020). Explaining the MENA Paradox: Rising Educational Attainment, Yet Stagnant Female Labor Force Participation. Demographic Research, 43, 817–850. https://doi.org/10.4054/demres.2020.43.28
  • Assad, R., & Kraft, C. (2015). The Structure and Evolution of Employment in Egypt. In R. Assad & C. Kraft (Eds.), the Egyptian Labor Market in an Era of Revolution (pp. 27–51). Oxford University Press. https://doi.org/10.1093/acprof:oso/9780198737254.003.0002
  • Beau dry, P., & Koop, G. (1993). Do recessions permanently change output? Journal of Monetary Economics, 31(2), 149–163. https://doi.org/10.1016/0304-3932 (93)90042-E
  • Bradley, M. D., & Jansen, D. W. (2018). Nonlinear evidence on the existence of jobless recoveries. Studies in Nonlinear Dynamics & Econometrics, 22(1), 20160081. https://doi.org/10.1515/snde-2016-0081
  • Brown, R. L., Durbin, J., & Evans, J. M. (1975). Techniques for Testing the Constancy of Regression Relationships over Time. Journal of the Royal Statistical Society. Series B (Methodological), 37(2), 149–192.
  • (2011). Labor Force Survey, Central Agency for Public Mobilization and Statistics.
  • DeNicco, J. P. (2015). Employment-At-Will Exceptions and jobless recovery. Journal of Macroeconomics, 45, 245–257. https://doi.org/10.1016/j.jmacro.2015.05.003
  • (2020). Views on the Crisis: Egypt’s Labor Market. The Egyptian Center for Economic Study.
  • El-Ehwany, N., & El-Megharbel, N. (2009). Employment intensity of growth in Egypt with a focus on manufacturing industries. Egyptian Center for Economic Studies (ECES), Working Paper Series.
  • El-Ghamrawy, T. (2014). The Impact of Trade Openness on Employment and Wages in Egypt’s Manufacturing Sector. ECES Working Papers. 176.
  • Abdou, D., & Zaazou, Z. (2013). The Egyptian revolution and post socio-economic impact. Topics in Middle Eastern and African Economies, 15(1), 92–115.
  • Assad, R., Hendy, R., Lassassi, M., & Yassin, S. (2020). Explaining the MENA Paradox: Rising Educational Attainment, Yet Stagnant Female Labor Force Participation. Demographic Research, 43, 817–850. https://doi.org/10.4054/demres.2020.43.28
  • Assad, R., & Kraft, C. (2015). The Structure and Evolution of Employment in Egypt. In R. Assad & C. Kraft (Eds.), the Egyptian Labor Market in an Era of Revolution (pp. 27–51). Oxford University Press. https://doi.org/10.1093/acprof:oso/9780198737254.003.0002
  • Beau dry, P., & Koop, G. (1993). Do recessions permanently change output? Journal of Monetary Economics, 31(2), 149–163. https://doi.org/10.1016/0304-3932 (93)90042-E
  • Bradley, M. D., & Jansen, D. W. (2018). Nonlinear evidence on the existence of jobless recoveries. Studies in Nonlinear Dynamics & Econometrics, 22(1), 20160081. https://doi.org/10.1515/snde-2016-0081
  • Brown, R. L., Durbin, J., & Evans, J. M. (1975). Techniques for Testing the Constancy of Regression Relationships over Time. Journal of the Royal Statistical Society. Series B (Methodological), 37(2), 149–192.
  • (2011). Labor Force Survey, Central Agency for Public Mobilization and Statistics.
  • DeNicco, J. P. (2015). Employment-At-Will Exceptions and jobless recovery. Journal of Macroeconomics, 45, 245–257. https://doi.org/10.1016/j.jmacro.2015.05.003
  • (2020). Views on the Crisis: Egypt’s Labor Market. The Egyptian Center for Economic Study.
  • El-Ehwany, N., & El-Megharbel, N. (2009). Employment intensity of growth in Egypt with a focus on manufacturing industries. Egyptian Center for Economic Studies (ECES), Working Paper Series.
  • El-Ghamrawy, T. (2014). The Impact of Trade Openness on Employment and Wages in Egypt’s Manufacturing Sector. ECES Working Papers. 176.
  • Elroukh, A. W., Nikolsko-Rzhevskyy, A., & Panovska, I. (2020). A look at jobless recoveries in G7 countries. Journal of Macroeconomics, 64, 103206. https://doi.org/10.1016/j.jmacro.2020.103206
  • Hamilton, J. D. (1989). A New Approach to the Economic Analysis of No stationary Time Series and the Business Cycle. Econometrical, 57(2), 357–384. https://doi.org/10.2307/1912559
  • Hamilton, J. D. (2017). Why You Should Never Use the Hodrick-Prescott Filter (Working Paper No. 23429). National Bureau of Economic Research. https://doi.org/10.3386/w23429
  • Hassan, M., & Kandil, M. (2011). The Relation between Public and Private Employment in Egypt: Evidence and Implications. Egyptian Center for Economic Studies.
  • Hodrick, R. J., & Prescott, E. C. (1997). Postwar U.S. Business Cycles: An Empirical Investigation. Journal of Money, Credit and Banking, 29(1), 1. https://doi.org/10.2307/2953682
  • Hyatt, H. R., & Spletzer, J. R. (2013). The recent decline in employment dynamics. IZA Journal of Labor Economics, 2(1), 5. https://doi.org/10.1186/2193-8997-2-5
  • (2021). the Impact of COVID-19 on Employment and Wages in Egypt. International Labor Organization.
  • Kim, C.-J., Morley, J., & Piger, J. (2005). Nonlinearity and the permanent effects of recessions. Journal of Applied Econometrics, 20(2), 291–309. https://doi.org/10.1002/jae.831
  • Klau, A. (2009). Impact of the economic crisis on trade, foreign investment, and employment in Egypt. International Labor Organization. https://www.ilo.org/employment/Whatwedo/Eventsandmeetings/WCMS_124443/lang--en/index.htm
  • Morley, J., & Piger, J. (2012). The Asymmetric Business Cycle. The Review of Economics and Statistics, 94(1), 208–221.
  • Mowla, S. (2011). Vulnerable employment in Egypt. The Egyptian Centre for Economic Studies (ECES). Working Paper No. 165.
  • Narayan, P. K. (2005). The saving and investment nexus for China: Evidence from cointegration tests. Applied Economics, 37(17), 1979–1990. https://doi.org/10.1080/00036840500278103
  • Newey, W. K., & West, K. D. (1987). A Simple, Positive Semi-Definite, Heteroskedasticity and Autocorrelation Consistent Covariance Matrix. Econometrical, 55(3), 703. https://doi.org/10.2307/1913610
  • Panovska, I. B. (2017). WHAT EXPLAINS THE RECENT JOBLESS RECOVERIES? Macroeconomic Dynamics, 21(3), 708–732. https://doi.org/10.1017/S1365100515000656
  • Pesaran, M. H., & Shin, Y. (1996). Cointegration and speed of convergence to equilibrium. Journal of Econometrics, 71(1–2), 117–143. https://doi.org/10.1016/0304-4076 (94)01697-6
  • Pesaran, M. H., Shin, Y., & Smith, R. J. (2001). Bounds testing approaches to the analysis of level relationships. Journal of Applied Econometrics, 16(3), 289–326. https://doi.org/10.1002/jae.616
  • Sinclair, T. M. (2009). Asymmetry in the Business Cycle: Friedman’s Plucking Model with Correlated Innovations. Studies in Nonlinear Dynamics & Econometrics, 14(1). https://doi.org/10.2202/1558-3708.1688
Statistics
Article View: 124
PDF Download: 105