(DP 1999-03) Estimating the Modes of Labor Force Participation in the Philippines

Abstract

This study explores the correlates of various modes of labor force participation in the Philippines. Data from the Labor Force Survey of the third quarter of 1994 and the Family Income and Expenditures Survey of the same year are used to estimate the parameters of a mixed logit model in which potential income, a function of wage offers, constitutes the conditional variable and socioeconomic and demographic characteristics are the multinomial variables. The results suggest that (a) the probability of a worker’s being in a particular mode of labor force participation is a concave function of potential income in that mode, (b) unmarried male workers are the least likely to be fully employed, (c) years spent in high school and college increase both the probability of unemployed and of full employment, (d) the presence of elderly household members has a negative impact on the probabilities of invisible underemployment and full employment and a positive impact on the probabilities of unemployment and visible underemployment, and (e) in general, workers who reside outside of the National Capital Region have higher probabilities of unemployment and underemployment and lower probabilities of full employment.