nep-ara New Economics Papers
on Arab World
Issue of 2009‒05‒09
two papers chosen by
Quentin Wodon
World Bank

  1. Financial Integration of North Africa Stock Markets By Onour, Ibrahim
  2. Returns to Qualification in Informal Employment: A Study of Urban Youth in Egypt By Frost, Jon

  1. By: Onour, Ibrahim
    Abstract: This paper investigates long-term relationship that links stock prices of three major North African stock markets: Egypt, Morocco, and Tunisia . The paper shows, there is strong evidence of multivariate and bivariate nonlinear long-term relationship between stock prices of these markets. Nonlinear cointegration between stock prices imply portfolios in these markets are inefficient (systematic risk cannot be diversified away), as movement in the price of one market influence the movement in another market in a predictable direction and disproportionately.
    Keywords: cointegration; portfolio; diversification; nonparametric
    JEL: E44 C01
    Date: 2009–04–10
  2. By: Frost, Jon
    Abstract: Informal employment is a reality for roughly two-thirds of economically active youth in urban Egypt, and it has been argued to be correlated with poverty, poor working conditions, and few opportunities for advancement. This essay analyzes whether informal employment rewards job qualification measures, using survey data from 2006 and a Blinder-Oaxaca wage decomposition. After creating a taxonomy of formal, para-formal, and informal modes of qualification, it is shown that formal public and formal private jobs tend to reward those with formal qualifications, while informal employment tends to reward informal qualification mechanisms. The notion that informal employment does not reward qualification is disputed. Furthermore, there are large wage premia based on formality of employment, region, and gender. The results can be explained by analyzing the formality decision and the qualification decisions of youth. This suggests an alterative explanation for “dualistic” outcomes in youth labor markets.
    Keywords: informal employment; youth employment; human capital; developing country labor markets; wage regression
    JEL: O17 J24 J42
    Date: 2008–09

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