Unemployment Problems and Policies in Less Developed Countries

The issue addressed is the nature and content of unemployment in the less developed countries. Own-account workers constitute a much larger percentage of the labor force in the developing countries than in the more developed ones. Unemployment is often hidden from the survey enumerator by government policy. There is difficulty in using conventional definitions and classifications to illuminate the unemployment problem in developing countries. Policymakers are greatly concerned with 2 things: 1. the availability of labor employment in various activities, and 2. the welfare effects of unemployment. Many countries have distorted incentives in favor of capital so that employment has been heavily penalized. A survey of unemployment in these countries should focus on questions designed to show how the adult members of the household spend their time and to what extent the activities performed by household members are rewarded.