01921cas a2200253 a 4500 AALejournalIMF014962 230101c9999 xx r poo 0 0eng d 5.00 USD 9781484326800 1018-5941 BD-DhAAL BD-DhAAL Stepanyan, Ara. Fiscal Policy Implications for Labor Market Outcomes in Middle-Income Countries / Ara Stepanyan, Lamin Leigh. Washington, D.C. : International Monetary Fund, 2015. 1 online resource (24 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students Many governments have initiated public employment programs or expanded the existing ones in response to high unemployment. However, in many middle-income countries, a relatively large government coexists with persistently high unemployment. This paper explores the question of whether public employment gives rise to distortions in the labor market in the medium to long-run. Our findings do not provide any evidence that public employment reduces unemployment rate. The analysis in this paper shows that large public employment does significantly affect labor market outcomes in middle-income countries and leads to job destruction in the private sector. The extent of the impact is largely influenced by the degree of substitutability between public and private production and the size of the rents in the public sector. Mode of access: Internet Leigh, Lamin. IMF Working Papers; Working Paper ; No. 2015/017 Full text available on IMF http://elibrary.imf.org/view/journals/001/2015/017/001.2015.issue-017-en.xml IMF e-Library