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The formal Mexican labor market has shown important changes in the last five years: the employment in the industry has been decreasing whereas the employment in the service sector has been increasing. This study looks at the consequence of such changes on the aggregate productivity of the formal...
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groups. If the rate of job destruction is sufficiently low, the unemployment rates can get close to steady-state values … during the transition. Within the realm of feasible scenarios unemployment differentials are basically determined by the … unemployment benefits and provision of direct support to the employers of low-productivity workers. -- Unemployment Models …
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