nep-ara New Economics Papers
on Arab World
Issue of 2012‒05‒02
one paper chosen by
Quentin Wodon
World Bank

  1. Why is Agricultural Employment Increasing in Turkey? By Seyfettin Gursel; Zumrut Imamoglu

  1. By: Seyfettin Gursel (Bahcesehir University Center for Economic and Social Research (Betam)); Zumrut Imamoglu (Bahcesehir University Center for Economic and Social Research (Betam))
    Abstract: The decrease in the share of agricultural employment in Turkey has been reversed recently, especially during the global crisis. Agricultural employment increased by 17 percent between 2007 and 2010 and its share in total employment increased by 1.7 percentage points above its 2007 level. This paper studies the causes of the increase in agricultural employment. Is the surge in agricultural employment stemming from a decrease in the non-agricultural employment opportunities and the decrease in non-agricultural wages during the crisis? Or, have increasing food prices around the world caused an increase in agricultural income, making the agricultural sector more attractive for employment? We use a two-sector small-open economy model to analyze the effect of changes in world agricultural prices on sectoral employment. In order to quantify the implications of our model we exploit the regional variation in agricultural employment across 26 regions in Turkey. We use panel data covering agricultural prices and production, non-agricultural wages, employment and regional inflation between 2004 and 2010. We find that agricultural prices play an important role in explaining the observed variation in agricultural employment in Turkey. We fail to find evidence on the effect of non-agricultural wages on agricultural employment.
    Keywords: Regional employment, agricultural employment, economic development
    JEL: E32 R10
    Date: 2011–10

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