This paper analyzes the consequences of pursuing a less activist Government <p> employment stabilization policy strategy in Egypt. On the basis of a fairly stylized model we <p> find that a reduction of the Government’s involvement in the economy along with an <p> introduction of mild but binding...</p></p></p>

While examining the macroeconomic effects of increased government control of the informal sector, this paper develops a two-sector general equilibrium model featuring matching frictions and worker-firm wage bargaining. The same good is produced in the formal and in the informal sector. Moral...