ABSTRACT
As is the case in most Arab countries, Tunisia has started the new millennium with high unemployment rates. For the last ten years, despite steady growth in real GDP — averaging about 5 per cent per annum — it has not been sufficient to keep-up with the upsurge in jobseekers. This has particularly been troubling in regards to skilled workers, for whom the unemployment rate reached levels well above the national average. In a context like this, decision makers would typically highlight the importance of market efficiency as a means of increasing firm creation rates and lowering unemployment rates. In addition to direct positive effects on employment, high new firm entry rates would normally trigger valuable spillover effects as related to technical and organizational changes. Indeed, given that new firms are expected to be equipped with the latest technical and organizational knowledge, a structural change of the economy can be sparked to go hand-in-hand with high firm creation, so as to enhance labour productivity and stimulate faster growth rates.
