Results are shown in Table 3. The fertility rate has always a negative sign when significant as we should expect but it is not significant in two of the regions (EAS and ECS). The share of agriculture in value added is significant in four regions and always with the negative sign as expected. The log of manufacturing value added is significant in seven of the eight regions always with the positive sign except in the Sub-Saharan Africa region. The log of services value added is significant in five regions and always with the positive sign. We should conclude that, at the regional level, the main pillars of the U-shape hypothesis do behave as expected (when significant) and that this is true for the MENA region. If fertility rates and the share of agricultural value added decrease, FLP rates should go up. And if manufacturing and services perform well in terms of output, this should improve FLP. Hence, the drivers of FLP work as expected worldwide and also in the MENA region.

**Table 3 – FLP Panel Regressions by Region, Age 15 and above (AB-GMM)**

||(1)<br>Fertility<br>Rate|(2)<br>Agricultural share<br>in Value Added|(3)<br>Manufacturing Value<br>Added (ln, constant, local<br>curr.)|(4)<br>Services Value<br>Added (ln, constant,<br>local curr.)|Number of<br>observations|
|---|---|---|---|---|---|
|**ALL**|-0.412***|-0.024***|0.416***|0.478***|3,461|
|**EAS**|-0.032|0.007|0.343***|0.010|490|
|**ECS**|-0.109|-0.017***|0.385**|0.331***|966|
|**LCN**|-1.594***|-0.100***|0.804*|3.253***|553|
|**MEA**|-0.276***|-0.015|0.373*|0.552***|354|
|**NAC**|-2.044***|-0.047|2.116***|0.345|42|
|**SAS**|-0.334**|-0.025|0.370|0.154|145|
|**SSF**|-0.131***|-0.011***|-0.137**|0.148**|911|

Source: ILO-EAPEP database (Female LFP) and World Bank, World Development Indicators for other indicators. Significance level: ***=.01; **= .05; *=.1 - *; Standard errors, lagged variables and constants omitted. EAS: East Asia and the Pacific; ECS: Europe and Central Asia; LCN: Latin America and the Caribbean; MEA: Middle East and North Africa; NAC: North America; SAS: South Asia; SSF: Sub-Saharan Africa.

In the next section, we will turn to analyze MENA countries individually. However, what we should retain from this last regression is that the MENA region, as a whole, is not an exception in how it behaves vis-à-vis the main drivers of the U-shape hypothesis.

# **Within countries time-series**

The MENA region is very diverse - suffice to say the division between resource rich and resource nonrich economies – and the regional performance may hide a more complex picture of countries with different and perhaps opposite performances. As already discussed, within countries longitudinal studies are few worldwide but there is some evidence supporting the U-shape hypothesis for the US, France and the UK. It is, however, more difficult to find similar evidence for emerging or developing countries for two good reasons. One is that, by definition, emerging or developing economies are more likely to show only part of the U curve (they find themselves in the early stages of the structural transformation). The curve in Figure 1 for MENA countries, for example, seemed to show that these countries were transiting through the saddle point of the curve. And the second is that LFSs in these countries are scarcer and started more recently than in the developed world. Nonetheless, we now have longitudinal data for twenty and more years for many countries and we can use these data to further assess the anomaly represented by the MENA region.

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