Growth, employment and labor productivity: A long run analysis for the case of Argentina

JUAN EDUARDO SANTARCANGELO

Nueva York, USA

Workshop; New School University, Department of Economics, Graduate Faculty, Seminar Dissertation Workshop; 2010

Department of Economics, New School University

This dissertation explores, for the case of Argentina, the relationship between economic growth and employment by: Adopting a long term view, which will give us the opportunity to  provide some historical perspective on the variables under analysis Studying the main determinants of the relationship between growth and employment through the analysis of labor productivity; Analyzing the historical evolution and changes suffered by the labor supply by identifying is long run determinants; Integrating the demand (labor productivity) and supply (labor force supply) sides and predict, by forecasting analysis, the way in which employment, labor force and labor productivity will evolve under different growth scenarios The dissertation will be organized in three main chapters. After a brief introduction of the work, ambitions, motivations and structure of the dissertation, Chapter I will be devoted to the estimation of the determinants of labor productivity for the case of Argentina. In order to do that, the chapter will review not only the literature on the more common techniques and variables used to measure and explain changes in labor productivity; but also it will summarize the specific Argentinean labor productivity literature. Once this is done, I will estimate the long run growth path of labor productivity for the period 1960-2006 by building the Autoregressive Distributed Lag Model (ADL)) and the Error Correction Model (ECM). The chapter will allow me to study the relationship between growth and employment from 1960-2006. Chapter II will be devoted to the development of a long run labor force model that will give us an explanation of the main determinants affecting labor supply. In order to do this, after briefly presenting a short description of labor supply in Argentina for the period under analysis and a review of the labor supply literature, we will build an ADL and ECM labor supply models for the period 1960-2006. Chapter III using the models developed in chapters I and II that corresponds to the demand and supply of labor respectively, I will perform some forecasting with the aim of predicting how the relationship between growth and employment would evolve in the next years in Argentina. The forecast period would be from 2007 to 2012 and I will assume three possible growth scenarios: optimistic, moderate and pessimistic which corresponds to annual GDP growth rates of 8%, 4% and 1% respectively. The dissertation will end with the development of the main conclusions.