Agriculture: Transition Buffer or Black Hole? A Three-State Model of Employment Dynamics
City University of New York (CUNY) - College of Staten Island; Institute for the Study of Labor (IZA)
IZA Discussion Paper No. 676
We analyze the effect of land reform legislation on labor market dynamics in the Romanian economy. We show that the agricultural sector, a source of precarious employment, has become an absorbing state for certain categories of workers who lost their jobs in the nonagricultural sector. A random utility model is used to represent individuals' sequential labor market decisions. The resulting multivariate probit model is estimated using Markov chain Monte Carlo methods.
Number of Pages in PDF File: 48
Keywords: Labor Force Participation, Three-state Dynamic Model, Multivariate Probit, Markov Chain Monte Carlo, Transition Economy, Land Reform
JEL Classification: C11, C15, C33, C35, J23
Date posted: February 7, 2003