Skip to main content

Research Repository

Advanced Search

Demand-side policies for employment promotion in low-and middle-income countries

Aboobaker, Adam; Michell, Jo

Authors

Adam Aboobaker

Jo Michell Jo.Michell@uwe.ac.uk
Professor of Economics



Abstract

High rates of unemployment and underemployment are widespread in many low- and middle-income countries (LMCs). Progress has been disappointing during a period in which the historical policy focus on capital accumulation and structural transformation was superseded by microeconomic policy interventions aimed at education and skills development, and reforms to promote efficient institutional structures and financial systems. The specific challenges of macroeconomic management for structural transformation do not receive substantial discussion in the contemporary development literature.

Since the 2008 crisis, however, the wider consensus has shifted. The emphasis on skills promotion has lessened, and increasing focus is placed on the demand side. It is widely accepted that rich countries have suffered from secular stagnation – persistent deficiency of aggregate demand alongside weak growth in capital investment and productivity – and from hysteresis – persistent negative labour market responses to weak demand. Both the academic literature and policy organisations increasingly conclude that monetary policy acting alone is insufficient to counter stagnationary tendencies, fiscal policy has an important role, and weak demand can have permanent negative effects on growth and productivity and thus the creation of good jobs.

In this paper we provide a structured review of the relevant literature, and an exposition of key concepts for the analysis and design of demand-side policy for sustainable employment promotion. We hope this will be useful to those involved in policy design who are not familiar with all of the literature and debates on these issues.

Citation

Aboobaker, A., & Michell, J. (2022). Demand-side policies for employment promotion in low-and middle-income countries

Report Type Policy Document
Publication Date Jun 21, 2022
Publicly Available Date Mar 29, 2024
Keywords Demand, development, emerging markets, jobs, work, decent work, employment policy, education, skills, rapid assessment, economic recovery, economic sectors, gender equality, youth, COVID-19, survey
Public URL https://uwe-repository.worktribe.com/output/9780471
Publisher URL https://www.ilo.org/employment/Whatwedo/Publications/WCMS_849235/lang--en/index.htm
Additional Information ISBN: 9789220371961