Spatial social effects on the decision to participate in the youth labor market in a developing country
Globally, many public policies seek to improve the results in participation, employment, and unemployment of the youth in the labor market. Evidence shows that education, age, sex, income conditions of the household, and working conditions affect labor market participation. However, how the behavior of the closest individuals affects the decision of the younger individuals to labor participation in a developing country is a matter of discussion. Using GPS location for 1094 young people, I estimate a spatial model for individual decisions to participate in the labor market in Colombia. Results show that the nearby individual’s similar decision regarding labor participation affects the youth’s decision to participate or social effects in youth labor participation.