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Sri Lanka - A fresh look at unemployment (English)

The primary objective of this study is to further explore the reasons for the high level of youth unemployment in Sri Lanka using individual records from the 1995 Labor Force Survey (LFS) conducted by the Department of Census and Statistics (DCS). In particular, the study will test the three main hypotheses already presented in the literature by conducting rigorous econometric analysis using the large volume of microeconomic data available from the quarterly Labor Force Survey. The data are analyzed through a comprehensive econometric exercise using multivariate and probit regressions on unemployment status, earnings functions which control for individual and job characteristics, and by carrying out time series analysis of unemployment and wages between 1980-97. Chapters 1 and 2 provide background information on Sri Lanka's economic reforms and performance over the last decade, and summarize the conclusions of existing literature on unemployment there. Chapter 3 presents the new data and methodology used in this study, while Chapter 4 discusses the findings. Chapter 5 explains the results obtained from the data analysis from a broader public policy perspective, and Chapter 6 presents some reform options which could have positive impacts on the labor market.


  • Document Date


  • Document Type

    Pre-2003 Economic or Sector Report

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  • Country

    Sri Lanka,

  • Region

    South Asia,

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  • Doc Name

    Sri Lanka - A fresh look at unemployment

  • Keywords

    Governance and Public Sector Management;private sector participation in infrastructure;Labor Market;unemployment rate;informal sector;labor earning;public sector job;skill mismatch;salary structure;competition in product markets;equal access to education;individual characteristic;female labor force participation;private sector job;labor market segmentation;job security regulation;high unemployment rate;public sector worker;labor market regulation;formal sector wage;labor force participant;decline in unemployment;female unemployment rate;high youth unemployment;public sector employment;foreign exchange market;private sector counterpart;increase in labor;years of schooling;son or daughter;aggregate unemployment rate;source income;source of income;rate of growth;Inflation & unemployment;collective bargaining agreement;effect of trade;formal labor market;product market competition;labor dispute resolution;national unemployment rate;effects of unemployment;terms of trade;public policy reform;number of workers;special economic zone;vocational training center;labor force survey;civil service pension;flow of labor;labor market condition;unpaid family worker;form of governance;public policy perspective;Public Administration Reform;implementation of reform;real wage index;per capita income;rural labor market;public enterprise sector;large budget deficit;informal labor market;interest rate liberalization;informal sector enterprise;family support system;termination of employment;financial sector liberalization;labor regulation;trade union;job characteristic;regression coefficient;average wage;casual worker;probit regression;educated youth;wage differential;education level;econometric analysis;tariff rate;university degree;government administration;Demographic Transition;cash wage;wage premium;household head;youth unrest;income support;work experience;tariff protection;salaried worker;political interference;tradable sector;job tenure;free education;market reality;employment policy;Employment Policies;firm size;wage gap;foreign investor;downward pressure;Job Creation;minimum wage;Labor migration;wage rigidity;industrial relation;economic reform;rural area;banking sector;wage increase;demographic change;unemployment problem;econometric result;maximum tariff;full employment;liberal trade;dollar term;Macroeconomic Policy;domestic enterprise;state control;stock market;independent variable;education attainment;liberalization policy;urban youth;tariff structure;external trade;politically active;job opening;public servant;rent sharing;upward mobility;work effort;sustainable reform;political patronage;governance weaknesses;full participation;mandatory retirement;econometric model;white-collar employment;financial control;high frequency;high tariff;rural district;unprotected sector;urban districts;regression table;dairy product;empirical evidence;daily wage;limited competition;regression analysis;political affiliation;suitable employment;political motivation;selection model;rural youth;daily rate;university graduate;social context;private employer;robustness analysis;educational qualification;Annual Pay Increase;market economy;sample mean;benefit scheme;pay schedule;young population;research assistance;demographic trend;creating job;selection bias;employee benefit;employed persons;large enterprise;market liberalization;labor mobility;positive impact;domestic competitive;international community;disadvantaged youth;civil society;trade regime;participation rate;female participation;tea plantation;household earning;Job Vacancies;pension scheme;agricultural worker;outward migration;individual data;political agenda;aggregate data;secondary data;poverty program;school graduate;population census;employment generation;tax concession;government response;employment opportunity;employment opportunities;average worker;basic training;high wage;unemployed youth;social environment;protective tariff;Basic Education;unemployment figure;unemployment pressure



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Sri Lanka - A fresh look at unemployment (English). Washington, D.C. : World Bank Group.