Stochastic simulation model of employment and migration

Abstract

The purpose of this paper is to present a simulation model of labor market which focuses on stochastic modeling of the employment and migration processes on the level of a small country with economical situation characteristic for East- ern Europe. The actual data used for modeling were taken from labor market of Belarus. An emphasis was given to the problems of hidden unemployment and closely related manpower drain problem. The migration was split down to the job-related migration to CIS (former Soviet Union) states and to the devel- oped Western countries. It was argued that both problems may be generally resolved by way of increasing the salary level in the country. The simulation model was implemented using NetLogo language and free software tools. Ex- perimentation with the model allowed drawing specific conclusions regarding the domestic salary levels which may help to overcome negative manpower drain processes and reduce the hidden unemployment down to an acceptable level.