Education, Household Structure and Joint Labor Supply in Tunisia

This Discussion Paper has been presented as a part of the workshop called The Social-Economic Situation of Middle East Youth on the Eve of the Arab Spring, hosted on December 8 - 9th, 2012 at the American University in Beirut. This paper examines unemployment and labor force participation in Tunisia from 1984 to 2010. In light of the Arab Spring, it is important to understand what were the underlying economic conditions for young people on the eve of this major political event. We have three main findings. First, while unemployment is primarily a youth phenomenon in Tunisia, all workers with higher education have seen a deterioration of their job prospects. Second, the rise in schooling among Tunisian youth implies that this weakening of the higher-skilled job market has been particularly felt by the youth. Finally, we examine the degree to which marriage and fertility affect women’s labor supply. We find that the household structure (number and age of children) is an important determinant of female labor force participation. Likewise, the husband’s level of education affects the wife’s labor supply. However, we find that the effects of both of these factors depend upon a wife’s age and educational level.