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GTAP Resource #4689

"Access to Israeli Labor Markets: Effects on the West Bank Economy"
by Agbahey, Johanes, Khalid Siddig and Harald Grethe

The integration of the Israeli and Palestinian labor markets has for a long time attracted attention due the political-military conflict between the two regions and due to mobility restrictions. In the 1980s, access to Israeli labor markets accounted for a significant share of the total Palestinian employment. However, following the first and the second Palestinian uprisings, mobility restrictions and closures have been put in place and enforced. Depending on the intensity of the political tension, restrictions are either set at a high or at a low level. Taking advantage of this unique context, this study for the first time addresses the economy-wide effects of labor market relaxation between the two regions on the Palestinian economy. The study uses a SAM developed for the West Bank for the year 2011 with detailed representation of the labor market. Workers are categorized based on their demographic characteristics, their current workplace and eligibility to work permit in Israel. The behavioral relationships in a variant of STAGE suite of CGE models are extended to conform to the unique feature of the labor market between West Bank and Israel. This paper analyzes the effects of increasing the number of Palestinian workers in Israel from the actual 14% of total workers observed in 2011 back to 30% which was the level observed in the 1980s before the introduction of restrictions.

Keywords: labor market integration, CGE model, poverty, Near East region.

Resource Details (Export Citation) GTAP Keywords
Category: 2015 Conference Paper
Status: Published
By/In: Presented at the 18th Annual Conference on Global Economic Analysis, Melbourne, Australia
Date: 2015
Created: Agbahey, J. (4/14/2015)
Updated: Batta, G. (6/9/2015)
Visits: 602
- Baseline development
- Economic analysis of poverty
- Labor market issues
- Migration
- Middle East

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