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Labor exports from Palestine to Israel: a boon or bane for the West Bank economy? Cover

Labor exports from Palestine to Israel: a boon or bane for the West Bank economy?

Open Access
|Aug 2020

Figures & Tables

Figure 1

Evolution of Palestinian real GNI per capita (in constant 2015 US$) and the number of closure days, 1996–2016.

Source: B’Tselem, 2017; PCBS, 2020; UNCTAD, 2009.

Figure 2

Evolution of the share of Palestinians employed in Israel in Palestinian total employment and the unemployment rate in the Palestinian territories, 1996–2016.

Source: PCBS, 2017, 2000.

Table 1

Number of Palestinian workers in Israel in the base (physical units) and in the scenarios (% change as compared to the base)

Core scenariosSensitivity analyses
BasePreIntiAllElegAllUnskMoreSkPlus5%LessMob
(unit = 8 hours)(%)(%)(%)(%)(%)(%)
Low-skilled ineligible males17,364+35.7%−+39.4%+26.4%+35.7%−35.7%
Low-skilled weakly eligible males19,065+35.7%+49.7%+39.4%+26.4%+35.7%−35.7%
Low-skilled highly eligible males29,128+35.7%+49.7%+39.4%+26.4%+35.7%−35.7%
Low-skilled females1,162+35.7%+35.7%+39.4%+26.4%+35.7%−35.7%
High-skilled ineligible males3,123+35.7%−−+124.5%+35.7%−35.7%
High-skilled weakly eligible males1,254+35.7%+49.7%−+124.5%+35.7%−35.7%
High-skilled highly eligible males2,559+35.7%+49.7%−+124.5%+35.7%−35.7%
High-skilled females32+35.7%+35.7%−+124.5%+35.7%−35.7%
Total Palestinian workers in Israel73,687+35.7%+35.7%+35.7%+35.7%+35.7%−35.7%
Total Palestinian labor force717,855−−−−+5.0%−
Figure 3

Number of unemployed (thousands, absolute and percentage changes) in the Base and the PreInti scenarios.

Table 2

Changes in employment status (worker and percentage) among labor categories

Moving out of unemployment to employment in IsraelMoving out of unemployment to employment in the domestic marketTotal moving out of unemployment
Aggregate labor25,778 (56%)20,009 (44%)45,787 (100%)
Gender perspective
Male population25,352 (63%)15,038 (37%)40,390 (100%)
Female population426 (8%)4,971 (92%)5,397 (100%)
Skill perspective
Low-skilled23,452 (69%)10,415 (31%)33,866 (100%)
High skilled2,327 (20%)9,594 (80%)11,921 (100%)
Figure 4

Change in household consumption and in domestic output (in%).

Figure 5

Welfare effects (Equivalent Variation as a share of Base household expenditure).

Table 3

Changes in macroeconomic, household and labor force indicators compared to the Base under the sensitivity analyses and the scenario PreInti

IndicatorsCore ScenarioSensitivity analyses
PreIntiAllElegAllUnkMoreSkPlus5%LessMob
Macroeconomic indicatorsChange in real GDP+3.63%+3.51%+3.58%+3.64%+3.91%−3.98%
Change in domestic output+2.85%+2.80%+2.81%+2.90%+3.02%−2.92%
Change in import demand+5.76%+5.83%+5.68%+5.94%+5.84%−5.62%
Change in export −5.07%−5.37%−5.05%−5.21%−4.81%+5.36%
Household indicatorsChange in household consumption+6.53%+6.81%+6.43%+6.82%+6.32%−6.26%
Change in household income+9.76%+9.29%+9.62%+10.20%+9.44%−9 23%
Change in household welfare+5.45%+5.68%+5.37%+5.72%+5.27%−5.35%
Labor force indicatorsChange in the number of unemployed−36.96%−37.08%−36.79%−37.44%−30.08%+38.09%
Change in the number of employed in the domestic West Bank market+3.76%+3.78%+3.72%+3.87%+4.26%−4.03%
Annex 2

Production module nesting.

Source: The author.

Annex 3

Composition of GDP in 2011 in the West Bank.

Source: Social accounting matrix used for this study

Annex 4

List of accounts in the social accounting matrix

NoCommodity (c)NoCommodity (c) – contd.
1Olives25Cars and lorries
2Cereals, other crops26Machinery, and equipment
3Fruits, nuts and flowers27Furniture
4Vegetables, horticultural specialties28Other manufacturing
5Animals29Electricity, gas and water
6Milk30Construction
7Forestry products31Maintenance and repair of motor vehicles
8Fishery products32Repair of personal and household goods
9Stone, sand, clay and other minerals33Other retail sale
10Meat, meat products34Other wholesale
11Fish, fish products35Hotels and restaurants
12Processed fruits, vegetables36Freight transport by road
13Olive oil37Passenger land transport
14Oils, fats38Other transport, storage, travel agencies
15Grain mills, starches39National post activities
16Bakery products40Remaining communication
17Other food41Finance, insurance and auxiliary services
18Beverages42Real estate, and renting activities
19Textiles and wearing apparel and leather43Other business activities
20Paper and publishing products44Public administration, defence
21Coke, petroleum products45Education
22Other chemical products46Health, social work
23Other nonmetallic mineral products47Recreational, cultural and sporting
24Metals48Other services
NoActivity (a)NoActivity (a) – contd.
1Olive19Other manufacturing
2Growing of cereals and other crops n.e.c.20Electricity, gas and water supply
3Farming animals21Construction
4Forestry22Maintenance and repair of motor vehicles
5Mining and quarrying23Repair of personal and household goods
6Processing of olive oil24Retail sale
7Processing of other vegetable oil and fats25Wholesale
8Processing of basic foods26Accommodation and Restauration
9Processing of dairy products27Transport, storage
10Processing of grain mills and starches28National post activities
11Processing of other food29Remaining communication
12Manufacture of textile30Financial services
13Manufacture of wearing apparels31Other rental of buildings
14Manufacture of paper and publishing articles32Other real estate and business activities
15Manufacture of chemical products33Other business activities
16Manufacture of nonmetallic mineral products34Education
17Manufacture of metals35Health and social work
18Manufacture of machinery equipment36Other services
NoFactors (f)NoFactors (f) – contd.
1Low-skilled (LS), male, unqualified (UQ), employed in primary sectors23HS, male, WQ, employed in tertiary sectors
2LS, male, UQ, employed in secondary sectors24HS, male, HQ, employed in primary sectors
3LS, male, UQ, employed in construction25HS, male, HQ, employed in secondary sectors
4LS, male, UQ, employed in tertiary sectors26HS, male, HQ, employed in construction
5LS, male, weakly qualified (WQ), em- ployed in primary sectors27HS, male, HQ, employed in tertiary sectors
6LS, male, WQ, employed in secondary sectors28HS, female, employed in primary sectors
7LS, male, WQ, employed in construction29HS, female, employed in secondary sectors
8LS, male, WQ, employed in tertiary sectors30HS, female, employed in tertiary sectors
9LS, male, highly qualified (HQ), employed in primary sectors31Foreign workers in the domestic market
10LS, male, HQ, employed in secondary sectors32Capital
11LS, male, HQ, employed in construction33Land
12LS, male, HQ, employed in tertiary sectors
13LS, female, employed in primary sectorsNoDomestic institutions
14LS, female, employed in secondary sectors1Government
15LS, female, employed in tertiary sectors2Enterprise
16High-skilled (HS), male, UQ, employed in primary sectors3Kapital account
17HS, male, UQ, employed in secondary sectors4Stock change
18HS, male, UQ, employed in construction
19HS, male, UQ, employed in tertiary sectorsNoForeign institutions (w)
20HS, male, WQ, employed in primary sectors1Israel
21HS, male, WQ, employed in secondary sectors2Rest of the world
22HS, male, WQ, employed in construction
NoHouseholds (h)
1Households in quintile 1 with mostly low skilled members working only for local employers
2Households in quintile 1 with mostly low skilled members with at least one working in Israel
3Households in quintile 1 with mostly high skilled members working only for local employers
4Households in quintile 1 with mostly high skilled members with at least one working in Israel
5Households in quintile 2 with mostly low skilled members working only for local employers
6Households in quintile 2 with mostly low skilled members with at least one working in Israel
7Households in quintile 2 with mostly high skilled members working only for local employers
8Households in quintile 2 with mostly high skilled members with at least one working in Israel
9Households in quintile 3 with mostly low skilled members working only for local employers
10Households in quintile 3 with mostly low skilled members with at least one working in Israel
11Households in quintile 3 with mostly high skilled members working only for local employers
12Households in quintile 3 with mostly high skilled members with at least one working in Israel
13Households in quintile 4 with mostly low skilled members working only for local employers
14Households in quintile 4 with mostly low skilled members with at least one working in Israel
15Households in quintile 4 with mostly high skilled members working only for local employers
16Households in quintile 4 with mostly high skilled members with at least one working in Israel
17Households in quintile 5 with mostly low skilled members working only for local employers
18Households in quintile 5 with mostly low skilled members with at least one working in Israel
19Households in quintile 5 with mostly high skilled members working only for local employers
20households in quintile 5 with mostly high skilled members with at least one working in Israel
NoTaxes (g)
1Production tax
2Factor income tax
3Direct tax
4Excise tax
5Value Added Tax
6Tariff on imports from Israel
7Tariff on imports from the rest of the world
8Factor tax use on Low-skilled male unqualified employed in primary sectors
9Factor tax use on Low-skilled male unqualified employed in secondary sectors
10Factor tax use on Low-skilled male unqualified employed in construction sectors
11Factor tax use on Low-skilled male unqualified employed in tertiary sectors
12Factor tax use on Low-skilled male weakly qualified employed in primary sectors
13Factor tax use on Low-skilled male weakly qualified employed in secondary sectors
14Factor tax use on Low-skilled male weakly qualified employed in construction sectors
15Factor tax use on Low-skilled male weakly qualified employed in tertiary sectors
16Factor tax use on Low-skilled male highly qualified employed in primary sectors
17Factor tax use on Low-skilled male highly qualified employed in secondary sectors
18Factor tax use on Low-skilled male highly qualified employed in construction sectors
19Factor tax use on Low-skilled male highly qualified employed in tertiary sectors
20Factor tax use on Low-skilled female employed in primary sectors
21Factor tax use on Low-skilled female employed in secondary sectors
22Factor tax use on Low-skilled female employed in tertiary sectors
23Factor tax use on High-skilled male unqualified employed in primary sectors
24Factor tax use on High-skilled male unqualified employed in secondary sectors
25Factor tax use on High-skilled male unqualified employed in construction sectors
26Factor tax use on High-skilled male unqualified employed in tertiary sectors
27Factor tax use on High-skilled male weakly qualified employed in primary sectors
28Factor tax use on High-skilled male weakly qualified employed in secondary sectors
29Factor tax use on High-skilled male weakly qualified employed in construction sectors
30Factor tax use on High-skilled male weakly qualified employed in tertiary sectors
31Factor tax use on High-skilled male highly qualified employed in primary sectors
32Factor tax use on High-skilled male highly qualified employed in secondary sectors
33Factor tax use on High-skilled male highly qualified employed in construction sectors
34Factor tax use on High-skilled male highly qualified employed in tertiary sectors
35Factor tax use on High-skilled female employed in secondary sectors
36Factor tax use on High-skilled female employed in tertiary sectors

[i] Source: Own compilation

Annex 5

Shares of commodity groups in total exports and shares of exports in domestic output in the West Bank in 2011

Commodity groupsShares of exportsShares of exports in domestic output
Agricultural and food products21.1%22.4%
Mining products0.6%12.1%
Manufacturing products62.8%72.4%
Services15.4%3.2%
Total100%14.8%

[i] Source: Social accounting matrix used for the study

Language: English
Published on: Aug 17, 2020
Published by: Sciendo
In partnership with: Paradigm Publishing Services
JEL:

© 2020 Johanes Agbahey, Khalid Siddig, Harald Grethe, Scott McDonald, published by Sciendo
This work is licensed under the Creative Commons Attribution 4.0 License.