Central Data Catalog

Citation Information

Type Working Paper - WIDER Working Paper
Title Product market competition and the labour market: Evidence from South Africa
Author(s)
Issue 39
Publication (Day/Month/Year) 2020
URL https://doi.org/10.35188/UNU-WIDER/2020/796-5
Abstract
We study the relationship between product market competition and labour market outcomes in South Africa. We combine firm-level data from tax records with individual-level data from the labour force survey. We estimate markups across sectors, and derive a measure of employment concentration in high-markup sectors across South African district municipalities. We then test whether individual labour market outcomes differ systematically in those district municipalities where employment is more concentrated in high-markup sectors. We find that higher employment concentration in high-markup sectors is associated with higher unemployment and lower likelihood of transitions from unemployment to employment. This is differentially more the case for non-White, lower educated, and young individuals. The relationship remains strong when conditioning on a ri

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