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dc.titleThe Labor Market Worsening Effects of a Resource Bust: Evidence from the Crude Oil Price Shock in Ecuador
dc.contributor.authorParra-Cely, Sergio
dc.contributor.authorZanoni, Wladimir
dc.contributor.orgunitCountry Department Andean Group
dc.coverageEcuador
dc.date.available2022-06-08T00:06:00
dc.date.issue2022-06-08T00:06:00
dc.description.abstractTo assess the effects of an oil price bust on individual labor market outcomes, we leverage the 2015 exogenous decline in international oil prices with geographical variation in oil-dependency in Ecuador. To account for propagation mechanisms, we also test the causal effect of the oil price bust on public transfers to local autonomous governments. Reduced form results suggest a moderate oil price pass-through channel on wages and nonlabor earnings but not on labor supply and participation. Public transfers play an amplification role, as a one percentage point decrease in these funds implies workers in oil-dependent areas to experience a wage reduction of 1.5%. Spillover effects to nonextractive industries, with reduced economic activity at the firm level, seem to be the transmission channels explaining the drop in individual earnings during the oil price bust.
dc.format.extent53
dc.identifier.doihttp://dx.doi.org/10.18235/0004291
dc.identifier.urlhttps://publications.iadb.org/publications/english/document/The-Labor-Market-Worsening-Effects-of-a-Resource-Bust-Evidence-from-the-Crude-Oil-Price-Shock-in-Ecuador.pdf
dc.language.isoen
dc.publisherInter-American Development Bank
dc.subjectNatural Resource
dc.subjectOil Price
dc.subjectPetroleum
dc.subjectWage
dc.subjectLabor Market Outcome
dc.subjectOil Production
dc.subjectEconomy
dc.subjectLabor Market
dc.subjectSmall Business
dc.subjectTransfer Program
dc.subjectNatural Resource Exploitation
dc.subjectProductive Transformation
dc.subjectExtractive Cluster
dc.subjectExtractive Industry
dc.subject.jelcodeJ21 - Labor Force and Employment, Size, and Structure
dc.subject.jelcodeJ22 - Time Allocation and Labor Supply
dc.subject.jelcodeJ30 - Wages, Compensation, and Labor Costs: General
dc.subject.jelcodeH41 - Public Goods
dc.subject.jelcodeH72 - State and Local Budget and Expenditures
dc.subject.jelcodeI31 - General Welfare, Well-Being
dc.subject.keywordsResource bust;wages;public transfers;Ecuador;Extractivas;transformación productiva;región andina;Andean Region
dc.typeWorking Papers
idb.identifier.pubnumberIDB-WP-01354
idb.operationRG-T3717
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