Publication: The Labor Market Impact of Mobility Restrictions : Evidence from the West Bank
Date
2013-05
ISSN
Published
2013-05
Author(s)
Cali, Massimiliano
Miaari, Sami H.
Abstract
Using data on Israeli closures inside
the West Bank, this paper provides new evidence on the labor
market effects of conflict-induced restrictions to mobility.
To identify the effects, the analysis exploits the fact that
the placement of physical barriers by Israel was exogenous
to local labor market conditions and uses a measure of
conflict intensity to control for the likely spurious
correlation between local unrest, labor market conditions,
and the placement of barriers. The study finds that these
barriers to mobility have a significant negative effect on
employment, wages, and days worked per month. The barriers
had a positive impact on the number of hours per working
day. These effects are driven mainly by checkpoints while
other barriers, such as roadblocks and earth mounds, have a
much more limited impact. Only a tiny portion of the effects
is due to direct restrictions on workers' mobility,
suggesting that these restrictions affect the labor market
mainly by depressing firms' production and labor
demand. Despite being an underestimation of the actual
effects, the overall costs of the barriers on the West Bank
labor market are substantial: in 2007, for example, these
costs amounted to 6 percent of gross domestic product. Most
of these costs are due to lower wages, thus suggesting that
the labor market has adjusted to the restrictions more
through prices than quantities.
Link to Data Set
Citation
“Cali, Massimiliano; Miaari, Sami H.. 2013. The Labor Market Impact of Mobility Restrictions : Evidence from the West Bank. Policy Research Working Paper;No. 6457. © World Bank, Washington, DC. http://hdl.handle.net/10986/15595 License: CC BY 3.0 IGO.”
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