Explaining High Unemployment in ECCU Countries

Explaining High Unemployment in ECCU Countries
Author: Ronald James
Publisher: International Monetary Fund
Total Pages: 32
Release: 2019-07-11
Genre: Business & Economics
ISBN: 1498326218

In recent years, unemployment rates in some ECCU countries have been among the highest globally. This paper evaluates several factors that could explain them, finding that high unit labor costs, in a context of strong unionization, are significantly associated with high structural unemployment, while the global crisis added a cyclical component. Our analysis also suggests that high-paid jobs in the public and tourism sectors, which have been growing considerably in recent decades, could have increased the reservation wage and lowered labor force participation. We find no indication that high structural unemployment is related to the phase out of EU preferences on bananas/sugar exports or to a skills mismatch. As expected, unemployment has been substantially, but only temporarily fueled by large natural disasters.

St. Lucia

St. Lucia
Author: International Monetary Fund. Western Hemisphere Dept.
Publisher: International Monetary Fund
Total Pages: 75
Release: 2017-03-31
Genre: Business & Economics
ISBN: 147559092X

Despite some limited improvement in labor market conditions, unemployment remains high and growth modest as low competitiveness and structural bottlenecks continue to weigh on economic performance. Slow progress in addressing financial sector problems has left banks loaded with impaired assets and unable to support the economy. The new government is developing a program of pro-growth reforms, but policies have not yet been defined.

Eastern Caribbean Currency Union

Eastern Caribbean Currency Union
Author: International Monetary Fund. Western Hemisphere Dept.
Publisher: International Monetary Fund
Total Pages: 119
Release: 2016-10-25
Genre: Business & Economics
ISBN: 1475546378

The regional recovery is gaining ground, supported by continued low oil prices, the return to pre-2007 levels of tourism arrivals, and buoyant citizenship-by-investment receipts. Three failed banks have been resolved with no spillovers to the rest of the region and authorities have demonstrated improved fiscal management. Risks in the short run appear to be balanced but the region still faces many vulnerabilities that jeopardize the medium-term outlook. This year’s discussions took stock of the progress made and the policies needed to address key vulnerabilities related to the weak banking system, high debt, susceptibility to natural disasters, and competitiveness.

Inequality in a More Equal World—Labor Market Gender Gaps in St. Lucia

Inequality in a More Equal World—Labor Market Gender Gaps in St. Lucia
Author: Hyunmin Park
Publisher: International Monetary Fund
Total Pages: 34
Release: 2024-06-14
Genre: Business & Economics
ISBN:

St. Lucia has enviably high female labor force participation rate and strikingly low participation gap vis-à-vis male. The latter is lower than OECD average and way below world average. Women are also more educated than men. Yet, using a micro dataset of St. Lucia Labor Force Survey over the period 2016-2021, our analysis points towards disproportionate effects of childcare on female participation and unemployment and a substantial gender gap in labor income for workers without higher education. Moreover, the income gap is not explained by observable worker characteristics. While the paper does not explore causal links, this unique feature of high female participation and, yet, considerable gender gaps in other dimensions could be due to the social, historical, and political structure that resulted in a matrifocal but not a matriarchal system. At the same time, the small gender gaps for workers with higher education across participation, unemployment, and labor income seem to suggest that women can overcome some barriers through education. Our results bring to the fore two crucial aspects related to gender studies: (i) While macroeconomic indicators like female labor participation rate are important tools, they are not always sufficient to capture progress in gender equality; and (ii) econometric analysis needs to be complemented with a more holistic understanding of the history and social context shaping deeply rooted gender traits.

Corporate versus National Interest in US Trade Policy

Corporate versus National Interest in US Trade Policy
Author: Richard L. Bernal
Publisher: Springer Nature
Total Pages: 283
Release: 2020-10-31
Genre: Business & Economics
ISBN: 3030569500

This book provides a history of the WTO US-EU banana dispute through the lens of a major actor: the US-owned multinational firm, Chiquita Brands International. It documents and explains how Chiquita succeeded in having the Clinton administration pursue a trade policy of forcing the European Union to dismantle its preferential banana import regime for exports from the small English-speaking Caribbean (ESC) countries. The export of bananas was critically important to the social stability and economic viability of these countries and that was in the national security interest of the United States. The experience indicates that succeeding in this goal was detrimental to U.S. national security interest in the Caribbean.

New Insights into ECCU's Tourism Sector Competitiveness

New Insights into ECCU's Tourism Sector Competitiveness
Author: Mr.Manuk Ghazanchyan
Publisher: International Monetary Fund
Total Pages: 18
Release: 2019-07-17
Genre: Business & Economics
ISBN: 1498320813

Tourism has become the main driver of economic growth and employment and the most important source of income in the ECCU. Preserving and, possibly, enhancing the competitiveness of the tourism product is key for these countries. Unfortunately, the evidence shows that tourism arrivals to the ECCU have been declining slightly while global demand for tourism is on the rise. The objective of this paper is to study the structural determinants of competitiveness for the ECCU, defined as the relative cost advantage over other touristic regions (Di Bella, Lewis, and Martin 2007). Using a gravity model, we show that proximity to North American and European markets is indeed an important competitive advantage for the ECCU. However, despite this advantage, and, in some cases, specialization in high-end tourism, regression analysis shows that arrivals to the ECCU are sensitive to relative prices. Our simulations show that mitigating supply-side constraints would improve the ECCU’s competitiveness and allow the region to regain global market shares.

The Eastern Caribbean Economic and Currency Union

The Eastern Caribbean Economic and Currency Union
Author: Mr.Alfred Schipke
Publisher: International Monetary Fund
Total Pages: 546
Release: 2013-04-10
Genre: Business & Economics
ISBN: 1616352655

The Eastern Caribbean Economic and Currency Union (OECS/ECCU) is one of four currency unions in the world. As in other parts of the world in the aftermath of the global economic and financial crisis, the region is at a crossroads, facing the major challenges of creating jobs, making growth more inclusive, reforming the banking system, and managing volatility, while grappling with high public debt and persistent low economic growth. Policymakers have the critical task of implementing strong reforms to strengthen the monetary union while also laying the foundation for accelerating growth. This Handbook provides a comprehensive analysis of the key issues in the OECS/ECCU, including its organization and economic and financial sector linkages, and provides policy recommendations to foster economic growth.

Mauritius

Mauritius
Author: Mr.James Y. Yao
Publisher: International Monetary Fund
Total Pages: 19
Release: 2003-11-01
Genre: Business & Economics
ISBN: 1451874863

Despite strong economic growth, a "U"-curve unemployment phenomenon in Mauritius can be observed. Unemployment plunged from 21 percent to less than 4 percent between the early 1980s and the early 1990s, but this trend was reversed and the rate increased to 10 percent by end-2002. This paper provides an analytical framework to explain this development. The growth of higher-skilled sectors coupled with rigidities in the labor market seem to account for the observed unemployment behavior. Policy makers can improve employment prospects by not only investing in education to reduce skills mismatch but also by reforming the pay-setting institutions.

The Economics of Belonging

The Economics of Belonging
Author: Martin Sandbu
Publisher: Princeton University Press
Total Pages: 296
Release: 2020-06-16
Genre: Business & Economics
ISBN: 0691204527

"This is a proposal for a short book (of around 50,000 words) that speaks directly to the state we are in. The populist insurgency on both sides of the Atlantic and in Europe has deep roots in decades of mismanagement of economic and cultural change and as a result there are large groups of people who feel they no longer belong to the societies they live in, the disinfranchised, the left behind. The appeal of the anti-liberal populists who have emerged is that they convince those who feel left behind that national leaders are no longer working in their interests hence the rhetoric of 'putting America first' and 'making America great again' or the Brexiteers claining that they are 'taking back control.' In undemocractic regimes elsewhere populists play on people's feelings of insecurity in an unpredictable and fast changing world, promising security and order in exchange for democratic freedom. Liberal openness has been put on the defensive so it is up to us, electorates, politicians and policy makers, to show how an open and liberal economic system can once again belong to everyone. In the second part of the book Martin Sandbu outlines four key areas of economic policy that he believes will address not just the symptoms but the underlying causes of the current inequality which has led to so many people, especially the young and the most vulnerable being left behind. These include productivity, regional development, improved access to business finance for SMEs, and increaed representation for workers. He makes a number of other recommendaitons regarding housing, education for all, universal basic income and taxation. He concludes by saying that while these proposals add up to a radical package in total they are necessary reforms to ensure a sense of belonging and without them we could be opening the door to a radicalism which is both illiberal and undemocratic"--