A game theory model applied to the program: young people building the future in Mexico

Alvarado Garrido Aletsy 1 y Romero Lases Santiago 2

Reception: 3/10/2023 Aceptation: 17/11/2023

Abstract

Unemployment and poverty rates have impacted society in recent years, especially in the most vulnerable population. Governments have established programs that try to eradicate these problems. In this case, this work focuses on analyze, based on the game theory methodology, a viable option that allows the contract of the “Jenes Construyendo el Futuro” program to be made official, giving a new possibility of insertion into the labor market to the interns. The results obtained show that the Nash equilibrium is found when the company decides to formalize the contract that was previously had, and the intern decides to accept. This taking into account 2 conditions; that the company offers a balanced salary, and the intern provides production that meets the expectations established by the company. The study was oriented towards the identification and solution of the aforementioned problems, focusing particularly on poverty and unemployment. The general goal was to design effective measures that contribute to the progressive eradication of these socioeconomic challenges.

KeyWords

Contracts, Labor market, young employment, Labor reform.

Clasificacin JEL: E24, J01, J02, J41.

Introduction

Addressing the issue of poverty is complicated, as understanding its components requires more than just knowing the economic level of those identifying as poor. According to Ortiz and Ríos (2018), poverty is not only a social issue; other factors like geographic and cultural aspects must be considered. Therefore, it is essential to assess whether a population or community has the ability to lead fulfilling lives to determine if it is impoverished. In this context, Sen (1999) emphasizes the relevance of individual capabilities in determining their own existence, underscoring that control over income is just one aspect of this broader picture.

1Third semester student of the Bachelor's Degree in Economic and Financial Engineering, La Salle University, Mexico City, aletsyalvarado@lasallistas.org.mx

2hird semester student of the Bachelor's Degree in Economic and Financial Engineering, La Salle University, Mexico City, santiago.romero@lasallistas.org.mx

One of the origins of such poverty is the level of unemployment, which can arise when there are more people seeking work (labor demand) than available job positions (job supply). In developing nations, the focus on unemployment primarily centers on the formal labor market, which is usually more limited than the informal sector, sometimes leading to significant differences in size (PIIE, 2014). Particularly, Rosas and Jiménez-Bandala (2018) note the positive correlation between the level of unemployment and the likelihood of falling into a poverty trap, concluding that there is a significant relationship between poverty and unemployment.

According to the International Labour Organization (ILO, 2003), the concept of unemployment is structured on three criteria, where "Unemployed Persons" include all those of working age who are: a) "without work," meaning they do not have paid employment or are self-employed;b) "currently available for work," meaning they are available for paid employment or self-employment; c) "seeking work," meaning they have taken key actions in a recent period to find paid employment or self-employment.

Due to increasing unemployment rates, the youth has started exploring various strategies to contribute to their household incomes. These solutions include seeking support through government programs like "Jenes Construyendo el Futuro" and non-governmental organizations. Similarly, many young people opt for informal jobs or even venture into entrepreneurship out of necessity. In Mexico, the "Jvenes Construyendo el Futuro" program, considered one of the flagship programs of the federal government, is designed in the context of poverty and unemployment. It aims to train young people for the labor market, thereby reducing unemployment (Miquel, 2022). According to the Government of Mexico (2021), "Jvenes Construyendo el Futuro" is an Executive-driven program with the main objective of providing work-related training to young people aged 18 to 29 who are neither working nor studying. The training provided by companies lasts for 12 months, and participants receive a monthly scholarship that started at $3,600 and has increased in relation to the minimum wage. Currently, young people receive a monthly scholarship of $6,310.

Currently, the program has 2,491,595 beneficiaries, of which 1,053,151 are men and 1,438,444 are women (Government of Mexico, 2023). Although the program aims to trainyoung people and support them during their job search, it has not been conclusively proven that it ensures successful integration into the labor market after the training. Many participants fail to find employment after completing the training (Miquel, 2022), meaning these young people return to being part of the unemployed statistics.

Based on the above, this work aims to find agreements (equilibriums) between the government and companies, such that young beneficiaries remain employed after completing their training. The analysis to achieve thisobjective is through game theory,where the conditions to reach the proposed end are reported.

In addition to the introduction, the work presents a review of the literature on agreements and strategies in the labor market. Subsequently, the methodology on game theory is presented; in the following section, the analysis of these, as well as the results, is shown. In the penultimate section, the literature is compared with our results, concluding with conclusions, limitations, and future work.

LiteratureReview

The literature on government intervention to reduce unemployment is extensive. For example, García and Cruz (2017) analyze the causes of the decrease inunemployment in Latin Americabetween 2000 and 2013, posing the question of whether the reduction in unemployment is dueto labormarket reforms or increased capital accumulation. They conclude that capital accumulation is the main factor in reducing unemployment, supporting the idea that complementing and promoting government programs that encourage investment and stimulate effective demand can be an effective decision to reduce unemployment in society.

Aragn et al. (2021) highlight the importance of household well-being and its connection to the development of financial markets. They analyze how families use financial instruments to meet their needs and goals, pointing out that the financial stability of households in Mexico is affected by factors such as credit management and household composition.

Thus, the information provided by Arag et al. (2021) and García and Cruz (2017) in the context of government policies is considered to improve the economic situation of young people and, consequently, that of families. Both approaches support the creation of a broader economic and labor welfare strategy, where investment, job creation, and financial education combine to benefit families and society as a whole.

The "Jenes Construyendo el Futuro" program is directly related to the fundamental principles of the National Development Plan (NDP), which emphasizes the importance of understanding economic growth and increased productivity as means to achieve the general well-being of the population. The NDP, in its 2018-2024 edition, establishes that community development is a higher goal (Quiroz, 2021). In this scenario, the main success of the program lies in its comprehensive approach to promoting the development of communities. This program stands out by addressing various areas, such as economic, social, educational, health, artistic, and cultural aspects, in different regions of the country. An additional merit is that these programs are designed to systematically and effectively address the fundamental issues affecting community development. Thus, the "Jenes Construyendo el Futuro" program significantly contributes to achieving the goals of the NDP, establishing a direct connection between strengthening youth and the overall well-being of society.

The program holds significant relevance in relation to the National Development Plan (NDP)in three crucial areas. 1) As a novel program, it is necessary to evaluate if, during its first year of implementation, it has undergone significant changes in its design and operation, following the General Guidelines for the Evaluation of Federal Programs. 2) In assessing its contribution to national goals and objectives, it seeks to confirm the alignment of the program's purpose with the current NDP and its cross-cutting strategies. In this context, it is essential to identify shared concepts between the purpose of the "Jenes Construyendo el Futuro" Program and the objectives of sectoral, special, or institutional programs, ensuring that achieving the purpose directly contributes to the program's goals. 3) Finally, the integration of Results-Based Budgeting (RBB) in the program is positioned as a fundamental component to allocate resources efficiently and correct possible deficiencies in its design, thus promoting the effectiveness and continuous improvement of the program for the benefit of the participating young population (Juarico et al., 2021).

This work analyzes the employment situation of young beneficiaries in the "Jenes Construyendo elFuturo" program. Analysis regarding the employment situation of young people can be found in Majed (2018), which highlights the difficult situation that youth in Lebanon face, especially regarding employment opportunities and social marginalization. It points out the lack of job opportunities and structural inequalities in access to quality education, factors that have led to profound marginalization of youth in the country.

In this regard, Leston (2022) mentions that individuals with greater opportunities for job placement are those with better quality education, residing in developed territories. In Mexico, more than two decades ago, a process of restructuring began, resulting in job losses for thousands of workers. The reason behind this relationship is that this transformation left many people who previously worked in theindustrial sector in a vulnerable situation, with difficulties reintegrating into the labor market (Silva, 2016).

Often, young people face the challenge of finding employment, largely due to the limited network of professional contacts they usually have. In this sense, Vacchiano et al. (2018), based on a sample of 250 young people aged 20 to 34 in the metropolitan area of Barcelona, highlight the significant influence of personal contacts in job searching, a fundamental characteristic in the labor market. The authors point out that such influence becomes more relevant during periods of economic crisis, emphasizing its importance in the success of job searching and job retention in various sectors and situations.

Regarding the training involving young beneficiaries of our analysis, Rivera-Aguilera et al. (2020), through an analysis of a fast-food company in 2019, divided into a four-month period; analyze the organizational spaces of a training program to understand its effects onthe production ofyoungworkers. The results were presented through two axes: 1) dimensions of organizational space and 2) from space to the subject; the results show a postmodern young worker molded from a logic associated with their self-esteem. Finally, the importance of these training and job placement processes is highlighted, aiding in the consolidation of functional young individuals.

On the other hand, Alvarez-Sousa (2019) points out the factors that prevent the young working population of the European Union from not only staying employed but also becoming entrepreneurs. Among these factors are entrepreneurial spirit, the image of entrepreneurs, risk propensity, gender, age, education, perception of the household's economic situation. Added to contextual aspects: unemployment rate, labor relations system, and the country's development where they live.

Maintaining constant or stable employment is a signal for any company's work environment, which can help its positioning in the labor market. In this regard, Zenteno-Hidalgo and Silva (2016) analyze the relationship between the work environment and its effect on the productivity of workers for a Chilean natural resources company. Key factors for a better organizational climate include remuneration and fairness, teamwork and leadership, quality and effectiveness, communication, reduction of fear and increased trust, job security, and support for performance. They conclude that such a work environment reinforces the performance of workers and thereby the company's position in the market.

The analysis of labor productivity in small and medium-sized enterprises (SMEs) in Mexico highlights the importance of governmentprograms to boost this aspect. Baltodano and Leyva (2020) emphasize the need to increase participation in these programs and improve their dissemination, noting the limited evidence on the real impact of current policies. In this context, the Mexican government's "Jvenes Construyendo el Futuro" program seeks to provide work experience through training in companies, which plays a significant role in the context of SMEs. This program has a positive impact by offering companies access to talented and well-trained young individuals, while also providing young people with concrete opportunities to improve their experience and labor productivity.

Materiales y métodos

In this work,the decisions of young employees and thecompany are analyzed. Based on this, wewill identify the conditions that confirm that it is in the best interest of both parties for young individuals to remain employed and for the company to continue hiring them. The analysis will be conducted using concepts from game theory, and for this purpose, it is helpful to define the following concepts.

Definition 1 (Kreps, 1990): A game is a strategic interaction between two economic agents, referred to as players, represented as follows:

Γ= �𝑁𝑁, 𝐴𝐴𝑖𝑖 × 𝐴𝐴𝑗𝑗, 𝑈𝑈𝑖𝑖(𝑎𝑎𝑖𝑖, 𝑎𝑎𝑗𝑗)�,

where 𝑁𝑁is the number of players, 𝐴𝐴𝑖𝑖 is the set of strategies for player 𝑖𝑖, 𝑎𝑎𝑖𝑖∈𝐴𝐴𝑖𝑖, is the strategy of player 𝑖𝑖, 𝑎𝑎𝑗𝑗 ∈𝐴𝐴𝑗𝑗 is the strategy of player 𝑗𝑗and 𝑈𝑈𝑖𝑖�𝑎𝑎𝑖𝑖, 𝑎𝑎𝑗𝑗�is the payoff function for player 𝑖𝑖.

Facedwith the different decisions that player𝑗𝑗, can choose, player 𝑖𝑖should, throughdeductions or previous behaviors, have a better response. That is,

Definition 2 (Mas-Colell et al., 1995): Let Γ= �𝑁𝑁, 𝐴𝐴𝑖𝑖 × 𝐴𝐴𝑗𝑗, 𝑈𝑈𝑖𝑖(𝑎𝑎𝑖𝑖, 𝑎𝑎𝑗𝑗)�be a simultaneous game, a strategy 𝑎𝑎𝑖𝑖 is a better response from player 𝑖𝑖 𝑎𝑎𝑗𝑗 of player 𝑗𝑗, if,

′′

𝑈𝑈𝑖𝑖�𝑎𝑎𝑖𝑖, 𝑎𝑎𝑗𝑗�≥𝑈𝑈𝑖𝑖�𝑎𝑎𝑖𝑖, 𝑎𝑎𝑗𝑗�, ∀𝑎𝑎𝑖𝑖∈𝐴𝐴𝑖𝑖 (1)

The better response can be denoted as 𝑎𝑎𝑖𝑖 = 𝑀𝑀𝑀𝑀𝑖𝑖(𝑎𝑎𝑗𝑗). In this way, we have the following fundamental concept in game theory,

∗∗ ∗

Definition 3. A Nash equilibrium is a profile of strategies (𝑎𝑎1, 𝑎𝑎2,…, 𝑎𝑎𝑛𝑛), such that for each player 𝑖𝑖=

∗ ∗∗∗

1,2,… , 𝑛𝑛, 𝑎𝑎𝑖𝑖 is a better response to the best responses of player 𝑎𝑎𝑗𝑗, 𝑗𝑗≠𝑖𝑖, That is, 𝑎𝑎𝑖𝑖 = 𝑀𝑀𝑀𝑀𝑖𝑖(𝑎𝑎𝑗𝑗∗) and 𝑎𝑎𝑗𝑗 =

∗∗

𝑀𝑀𝑀𝑀𝑗𝑗(𝑎𝑎𝑖𝑖∗) for all 𝑗𝑗≠𝑖𝑖. In particular, for two players, a Nash equilibrium (𝑎𝑎1, 𝑎𝑎2∗) satisfies that 𝑎𝑎1 is a better

∗∗ ∗

response to 𝑎𝑎2 and 𝑎𝑎2 is a better response to 𝑎𝑎1.

To get a realistic approach to the hiring and training situation of young employees, 15 interviews were conducted with young interns from the Huauchinango region, Puebla, who are currently participating or have been part of the program. In addition, the questionnaire helps to better understand the behavior, effectiveness in entering the job market, and the willingness of respondents to work in training companies.

Based on the presented methodology, a game theory scenario will be deduced, where the players are the Intern and the Training Company.

On the part of the company, there are two options: to hire and not to hire.

On the part of the intern, there are the options to accept and not accept, as shown in Table 1.

Table 1. Relationship between Interns and Companies regarding hiring and salary

Intern

Source: Own elaboration

Where: UEm1 = Company's utility if it hires and intern accepts UEm2 = Company's utility if it hires and intern does not accept UEm3 = Company's utility if it does not hire and intern accepts UEm4 = Company's utility if it does not hire and intern does not accept UBe1 = Intern's utility if accepts and the company hires UBe2 = Intern's utility if does not accept and the company hires UBe3 = Intern's utility if accepts and the company does not hire UBe4 = Intern's utility if does not accept and the company does not hire Utility functions for the company, 𝑈𝑈𝐸𝐸𝐸𝐸1(𝐻𝐻𝑖𝑖𝐻𝐻𝐻𝐻, 𝐴𝐴𝐴𝐴𝐴𝐴𝐻𝐻𝐴𝐴𝐴𝐴)= 𝑃𝑃𝑏𝑏− 𝑊𝑊𝑏𝑏 (2) 𝑈𝑈𝐸𝐸𝐸𝐸2(𝐻𝐻𝑖𝑖𝐻𝐻𝐻𝐻, 𝐷𝐷𝐷𝐷𝑛𝑛𝐷𝐷𝐴𝐴𝑎𝑎𝐴𝐴𝐴𝐴𝐻𝐻𝐴𝐴𝐴𝐴)= 𝑃𝑃𝑃𝑃𝑃𝑃 − 𝑊𝑊𝑃𝑃𝑃𝑃 (3)

Where: Pb = Labor productivity of the intern PPr = Labor productivity of the professional 𝑊𝑊𝑏𝑏 = Intern's salary 𝑊𝑊𝑃𝑃𝑃𝑃 = Professional's salary Utility functions for the intern, 𝑈𝑈𝐵𝐵𝐵𝐵1(𝐻𝐻𝑖𝑖𝐻𝐻𝐻𝐻, 𝐴𝐴𝐴𝐴𝐴𝐴𝐻𝐻𝐴𝐴𝐴𝐴)= 𝑊𝑊𝐸𝐸𝐸𝐸−0 (4) 𝑈𝑈𝐵𝐵𝐵𝐵2(𝐻𝐻𝑖𝑖𝐻𝐻𝐻𝐻, 𝐷𝐷𝐷𝐷𝑛𝑛𝐷𝐷𝐴𝐴𝑎𝑎𝐴𝐴𝐴𝐴𝐻𝐻𝐴𝐴𝐴𝐴)= 𝑊𝑊𝑜𝑜𝐵𝐵 −𝐴𝐴 (5) Donde: 𝑊𝑊𝐸𝐸𝐸𝐸= Salary in the training company 𝑊𝑊𝑜𝑜𝐵𝐵 = Salary in another company 𝐴𝐴= time in search (monetary) The value of 𝐴𝐴can be interpreted as an opportunity cost for the worker to take the job. Thus, the conditions

for the intern to decide in favor of the company's proposal are, 𝑊𝑊𝐸𝐸𝐸𝐸−0> 𝑊𝑊𝑜𝑜𝐵𝐵 − 𝐴𝐴 (6) Therefore, to approach the specific value of the opportunity cost (t), we have, 𝐴𝐴 > 𝑊𝑊𝑜𝑜𝐵𝐵 − 𝑊𝑊𝐸𝐸𝐸𝐸 (7) Another condition for the company to decide to hire the intern is, Pb=PPr (8)

Analysis:

Labor productivity (𝑃𝑃) was taken from OECD information (2022), which indicates that the GDP per hour worked in Mexico is 94.1 USD, equivalent to 16,675 Mexican pesos.

The information gathered during the interviews was used to establish the Intern's Salary (𝑊𝑊𝑏𝑏) of $6,350, as interns are willing to reduce their salary to $4,500 despite being willing to go even lower (Figure 1).

Figure 1: Percentages obtained from the 15 interviews conducted regarding respondents' willingness to accept a salary reduction. Source: Own elaboration

TheGeneral Labor Law (1970) indicates that the minimumwageis the smallest amount that a worker must receive in cash for services rendered during a working day. Thus, by substituting the values obtained into expression (2), we have,

𝑈𝑈𝐸𝐸𝐸𝐸1(𝐻𝐻𝑖𝑖𝐻𝐻𝐻𝐻, 𝐴𝐴𝐴𝐴𝐴𝐴𝐻𝐻𝐴𝐴𝐴𝐴) = 16,675 −6,350 = 10,325

The salary paid to a professional (𝑊𝑊𝑃𝑃𝑃𝑃) was obtained according to Forbes (2023), which mentions that a sufficient salary is 8,600 pesos (464 dollars) per month. Based on expression (8), we have

PPr = 16,675

Then, substituting these values into (3),

𝑈𝑈𝐸𝐸𝐸𝐸2(𝐻𝐻𝑖𝑖𝐻𝐻𝐻𝐻, 𝐷𝐷𝐷𝐷𝑛𝑛𝐷𝐷𝐴𝐴𝑎𝑎𝐴𝐴𝐴𝐴𝐻𝐻𝐴𝐴𝐴𝐴): 16,675 −8,600 = 8,075

The company's utility (UEm3) if it does not hire the intern and the intern accepts is obtained from the difference in utilities between hiring the intern or the professional.

𝑈𝑈𝐸𝐸𝐸𝐸3(𝐷𝐷𝐷𝐷𝐻𝐻𝐷𝐷𝑛𝑛𝐷𝐷𝐴𝐴ℎ𝑖𝑖𝐻𝐻𝐻𝐻, 𝑎𝑎𝐴𝐴𝐴𝐴𝐻𝐻𝐴𝐴𝐴𝐴𝐷𝐷): 8,075 −10,325 = −2,250

In the case where the company does not hire and the intern does not accept, there is a utility of 0, as there is no expected labor productivity or salary to be paid.

𝑈𝑈𝐸𝐸𝐸𝐸4(Does not hire, Does not accept): 0 − 0=0

When the company hires the intern and the intern accepts, the intern has a utility equal to the Intern's Salary (Wb), because there is no opportunity cost (𝐴𝐴) to consider. Therefore, substituting the values into (4), we have,

𝑈𝑈𝐵𝐵𝐵𝐵1(𝐻𝐻𝑖𝑖𝐻𝐻𝐻𝐻, 𝐴𝐴𝐴𝐴𝐴𝐴𝐻𝐻𝐴𝐴𝐴𝐴): 6,350 − 0 = 6,350

The salary that the intern could obtain in another company (𝑊𝑊𝑜𝑜𝐵𝐵 ) was based on the premise that the increase would allow going from a daily salary of $172.87 to $207.44, which would be equivalent to $6,310 monthly according to the Government of Mexico (2022). Thus, based on expression (5), we have the following,

𝑈𝑈𝐵𝐵𝐵𝐵2(𝐻𝐻𝑖𝑖𝐻𝐻𝐻𝐻, 𝐷𝐷𝐷𝐷𝑛𝑛𝐷𝐷𝐴𝐴𝑎𝑎𝐴𝐴𝐴𝐴𝐻𝐻𝐴𝐴𝐴𝐴): 6,310 −19,050 = −12,740

The variable 𝐴𝐴was obtained considering the journalistic article by Mendoza (2022), where it was reported that 77% of the unemployed, almost eight out of ten people, spent between one and three months unsuccessfully searching for job opportunities. During three months of search, the person would be foregoing a salary of $6,350 that the training company would be paying. By multiplying that salary by the months of search, we get a result of $19,050; a value where expressions (6) and (7) are satisfied. Additionally,

𝑈𝑈𝐵𝐵𝐵𝐵3(Does not hire, Accepts): 0 − 6,350 ∗ 3= −19,050

If the company decides not to hire and the intern chooses not to accept, the obtained utility (𝑈𝑈𝐵𝐵𝐵𝐵4) is 0. This is because the intern has no salary (income), and there is no expected salary, meaning there is no loss.

𝑈𝑈𝐵𝐵𝐵𝐵4(Does not hire, Does not accept): 0 − 0=0

Resultados

By substituting all the intern's and company's utility expressions (See Table 2), we have the conditions to generate equilibrium. In this case,if the company decides to hire, thenthe best the intern can dois to Accept. If the intern decides to Accept, then thebest the company can do is to Hire. Therefore, (Hire, Accept) is the equilibrium for both players.

Table 2. Relationship between Interns and Companies regarding hiring and salary (Numerical data)

Intern

Source: Own elaboration.

According to the above, the main objective of this research is to find an option that allows companies to formalize the hiring of interns once their training is completed, preventing them from becoming unemployed. According to the data obtained from respondents, it was found that 60% of interns were unable to find employment after completing their training (Figure 2)."

Figure 2. Outcome of the 15 survey respondents regarding their situation after completing their training. Source: Own elaboration.

This is because, in case the trainee is not hired by the training center, they will be offered a menu of options such as the 'Month 13,' as indicated by the Government of Mexico (2020). However, incorporation into the labor market is not always achieved in these cases.

The search for these conditions defined an equilibrium between the company's situation and the intern, thereby implying the reduction of unemployment at thenational level. Finally, in relation to the Sustainable Development Goals (SDGs), this research covers the following objectives:

1) End poverty; the model deduces that young interns do not remain unemployed, achieved through the formalization of a contract at the end of training.

8)Decent work and economic growth; in this model, by formalizing the contract, it seeks to do so with an adequate salary so that the intern is willing to be hired; moreover, such a contract should comply with established laws.

10) Reductionof inequalities; this model helpedreducethe inequality faced by younginternsintheabsence of hiring compared to professionals who are hired in their place.

17)Partnerships to achieve goals; this model can be adopted and applied in various companies that train and can hire interns.

Additionally, the proposed hypothesis was fulfilled: finding a fair salary will contribute to reducing unemployment, which, in turn, willdecrease poverty rates, allowing interns to attaindecent jobs. To achieve the expected goals, it is crucial for companies to work together in establishing an appropriate salary.

Discussion ofResults

The model deduced that, upon completion of the intern's training, the company should provide them with a job. This job should be dignified and decent, meaning a job where the worker's human dignity is fully respected, with no discrimination, access to social security, and continuous training. Such characteristics will increase productivity, and the benefits could be shared. Dignified or decent work also includes unconditional respect for the collective rights of workers, such as freedom of association, autonomy, the right to strike, and collective bargaining (Chamber of Deputies of the H. Congress of the Union, 1970).

In Mexico, the Jenes Construyendo el Futuro program is focused on young people who are neither working nor studying, aiming to prevent the risk of dropping out of school. This approach is supported by Robles and Valle (2016), who highlight a strong association between student employment and labor conditions (salary, working hours, and economic activity) with school dropout in Mexico. In this line, Rodríguez et al. (2016) find a relationship and benefit between study and labor market integration. The authors emphasize the social vulnerability of the young population, as they face the challenge of transitioning to the working world, and their training is essential for labor market integration.

This study used a game theory model to represent possible scenarios in the hiring of young interns participating in the JenesConstruyendo el Futuro program. These scenarios deduced conditions to reach an equilibrium between labor supply and demand, i.e., decisions of acceptance and hiring between companies that train and hire and young people who train and learn. Equilibrium models can be found in Roth and Wilson (2019), who mention that market design has come to consider models, such as complementary approaches to examine different ways markets operate within an economic environment. They are focused on the labor market belonging to economic models, where their agents operate and interact rationally.

In this article, the players are companies and young interns who rationally seek to maximize their expected utility. Companies seek a certain labor productivity from interns, while young people expect adequate remuneration that allows them to stay in the workforce. According to Munck (2001), rational choice theory in interdependent decision-making is a set of theoretical principles and formal methodology known as game theory. Within this methodology, emphasis is placed on actors, strategic choices, and their ability to generate predictions in a logical and consistent manner.

Lin et al. (2019) address a cooperative game theory model between one player, which is the energy factory, and another player: the suppliers. The authors consider different conditions as scenarios within the game: full coalition, no coalition, and partially coalition. The Nash equilibrium found in their case explains the stabilization between the pricing strategy of the energy factory and that suppliers can conspire to control the price. This justifies our position regarding analyzing scenarios that allow the formalization of the contract for young interns. Such game scenarios are; (Hire, Do Not Accept), (Do Not Hire, Accept), (Do Not Hire, Do Not Accept), and (Hire, Accept).

In particular, our model deduces the scenario (Hire, Accept) as the Nash equilibrium. The objective was formulated through the analysis of the current situation in the labor market and various current problems.

A relation on the use of the methodology can be found in the research conducted by Roth (1984), where he provides an analysis ofgame theory on some contemporary problems facing the market at that time.Within his article, he secondarily mentions the problems encountered in the organization of this market and some of the solutions that were reached.

Conclusions

The study applied a game theory model to the labor market, specifically to young people between 18 and 29 years old who are neither working nor studying and who are part of the Jenes Construyendo el Futuro program. This was done with the aim that, upon completing the program's training, the insertion of interns into the labor market would not be guaranteed.

In this context, it was considered a viable option for registered training companies in the program with financial capacity to keep such interns on their staff. Our analysis considered two fundamental conditions; first, that the intern provides production equivalent to what a professional could contribute, and second, that the company provides a balanced salary of $6,300. These conditions achieve a Nash equilibrium (Hire, Accept), where the most favorable utilities are obtained for each player.

By offering young people meaningful opportunities, one can contribute to a more promising and equitable future, which, in turn, can have a positive impact on society as a whole. It can be concluded that training programs for young people can play an essential role in shaping functional skilled workers. Thus, emphasizing the importance of such programs for the effective integration of such populations into the labor market. In this context, it is strongly recommended to continue the program, as it was identified as a viable solution to address the mentioned problems. This program has not only proven to be effective but also provides a solid frameworkfor creating meaningfuljob opportunities. Favorable conditions were found that, when integrated into the program, can further enhance its positive impact.

It is important to note that this option could have repercussions in other sectors of the labor market. For example, it may cause a scarcity of job opportunities for professionals or individuals with more experience. Analyzingapopulation differentfrom young interns is left forfuturework. Finally, involving macroeconomic effects and poverty issues mentioned in the study are part of the limitations of our analysis, which are also left for future research.

References

Alvarez-Sousa, A. (2019). Emprendedores por necesidad. Factores determinantes -Necessity Entrepreneurs. Determining Factors. Reis: Revista Espala de Investigaciones Sociolicas, 166, 3–24.

http://dx.doi.org/10.5477/cis/reis.166.3

Aragn,G.D., Arango,F. O.,& Llanos, A. I. C. (2021). LASFINANZASDE LOS HOGARES MEXICANOS: ANÁLISIS CON REDES BAYESIANAS. Investigaci Econica, 80(317), 109–134.

http://dx.doi.org/10.22201/fe.01851667p.2021.317.77127

Baltodano-García, G., & Leyva Cordero, O. (2020). La productividad laboral: Una mirada a las necesidades de las Pymes en México. Revista Ciencia Jurídica Y Política, 6(11), 15–30.

https://doi.org/10.5377/rcijupo.v6i11.11228

Cámara de Diputados del H. Congreso de la Uni (1970). Ley Federal del trabajo. Gobierno de México. Recuperado de https://www.diputados.gob.mx/LeyesBiblio/pdf/LFT.pdf .

Cámara de Diputados del H. Congreso de la Uni (1970). Ley Federal del Trabajo Capítulo VI. Gobierno de México. Recuperado de https://www.gob.mx/cms/uploads/attachment/file/160336/LFT_1.pdf .

El Programa de Inversiones Intensivas en Empleo [PIIE]. (2014). Hacia el derecho al trabajo. Oficina Internacional del Trabajo, 1(Primera edici 2014). https://www.ilo.org/wcmsp5/groups/public/-- ed_emp/documents/publication/wcms_576313.pdf

Forbes Staff. (2023). El 45% de los mexicanos tiene un sueldo insuficiente para superar la pobreza. Forbes México. Recuperado de: https://www.forbes.com.mx/el-45-de-los-mexicanos-tiene-un-sueldo-insuficiente para-superar-la-pobreza/ .

García, L. F., & Cruz, M. (2017).Desempleo en América Latina: ¿flexibilidadlaboral o acumulacin decapital? Problemas Del Desarrollo, 48(189), 33–56. https://www.jstor.org/stable/90012725

Gobierno de México (2020), Secretaría Del Trabajo Y Previsi Social, S. Mes 13, Una gama de opciones de salida para los aprendices que concluyeron su capacitaci en Jenes Construyendo elFuturo.Recuperado de: https://www.gob.mx/stps/prensa/mes-13-una-gama-de-opciones-de-salida-para-los-aprendices-que concluyeron-su-capacitacion-en-jovenes-construyendo-el-futuro-234980?idiom=es

Gobierno de México (2021). Secretaria Del Trabajo Y Previsin Social, S. Preguntas frecuentes | Jvenes Construyendo el Futuro. Recuperado de: https://www.gob.mx/stps/articulos/preguntas-frecuentes jovenes-construyendo-el-futuro?idiom=es

Gobierno de México (2022) Secretaría Del Trabajo Y Previsin Social, S. En 2023, México superará el promedio de los salarios mínimo en América Latina. Recuperado de: https://www.gob.mx/stps/prensa/en 2023-mexico-superara-el-promedio-de-los-salarios-minimos-en-america-latina

Gobierno de México (2023). Jenes Construyendo El Futuro. Uno de los Programas para el Bienestar de mayor importancia del Gobierno de México. Recuperado de: https://elpais.com/mexico/2023-08 04/jovenes-construyendo-el-futuro-2023-requisitos-y-como-registrarse-al programa.html#:~:text=El%20programa%20J%C3%B3venes%20Construyendo%20el,maternidad%2 0y%20riesgos%20de%20trabajo .

Hernández, A. (2017). Teoría de Juegos Aplicada a la Economía. Universidad de Valladolid.

https://uvadoc.uva.es/bitstream/handle/10324/27450/TFG-E-409.pdf?sequence=1

Juarico, M. A. S., Mar, R. H., & Jaime, M. D. (Eds.). (2021). Las políticas y los programas pblicos en el marco del gobierno de la 4T en México: ¿continuidad o transformaci?. Universidad Automa Metropolitana, Unidad Lerma. https://www.researchgate.net/profile/Raul-Hernandez Mar/publication/351062409_COORDINACION_DE_LIBRO_CIENTIFICO_COLECTIVO_Libro_Las_politicas_y_lo s_programas_publicos_en_el_marco_del_gobierno_de_la_4T_en_Mexico/links/608232ff881fa114b41f9aaa/C OORDINACION-DE-LIBRO-CIENTIFICO-COLECTIVO-Libro-Las-politicas-y-los-programas-publicos-en-el marco-del-gobierno-de-la-4T-en-Mexico.pdf#page=48

Kreps, M. (1990). Games Theory and Economic Modelling. U.S.A, Oxford. https://doi.org/10.1093/0198283814.001.0001 .

Lin, L., Huang, C., & Zhao, L. (2019). Application of Cooperation Game Theory in Reactive Power Market of Hydraulic—Power Plant. Journal of Coastal Research, 578–581. http://dx.doi.org/10.2112/SI93-077.1

Leston, B. E.(2022). Desigualdades espaciales en el logro educativo al momento del primerempleo -Spatial Inequalities in Educational Attainment at the Time of One’s First Job. Estudios Sociolgicos, 40(120), 789– 824. http://doi.org/10.24201/es.2022v40n120.2168

Majed, R. (2018). ¿Nacida para ser exportada? Juventud en Líbano, ruptura entre educaciny empleo / Born to be exported? Youth in Lebanon, rupture between education and employment. Revista CIDOB d’Afers Internacionals, 118, 77–102. http://doi.org/10.24241/rcai.2018.118.1.77

Mas-Colell, A., Whinston M. & Green, J. (1995). Microeconomic Theory. New York: Oxford University Press.

https://brousseau.info/pdf/cours/Mas-colell_1995.pdf

Mendoza M. (2022), Mexicanos tardan hasta un ao en conseguir trabajo: Inegi Publimetro México. Recuperado de: https://www.publimetro.com.mx/noticias/2022/06/01/trabajo-cuanto-tiempo-tardan los-mexicanos-en-conseguir trabajo/#:~:text=Report%C3%B3%20que%2077%25%20de%20los,meses%20carentes%20de%20s ustento%20econ%C3%B3mico .

Miquel M. (2022). Vista de Una visi del funcionamiento del programa Jenes Construyendo el Futuro”. Revista Palimpsesto, 12 (20). http://doi.org/10.35588/pa.v12i20.5248

Munck, G. L. (2001). Game Theory and Comparative Politics: New Perspectives and Old Concerns. World Politics, 53(2), 173–204. https://library.fes.de/libalt/journals/swetsfulltext/10015476.pdf

OCDE (2022) Mejores políticas para una vida mejor. PIB por hora trabajada. Recuperado de: https://www.oecd.org/espanol/estadisticas/pib-hora-trabajada.htm .

Organizaci Internacional del Trabajo. 2003. International training compendium on labour statistics, Module 1 -Statistics of employment, unemployment, underemployment: economically active population (Ginebra, Oficina de Estadística de la OIT, Departamento de Integracin de Políticas).

https://labordoc.ilo.org/permalink/41ILO_INST/oti1e7/alma993696503402676

Ortiz, J., y Ríos, H. (2018). La Pobreza en México, un análisis con enfoque multidimensional. Análisis Econico, 28(69), 189–218. https://analisiseconomico.azc.uam.mx/index.php/rae/article/view/150

Quiroz Gez, J. G. (2021). Paradoxes of Community Development: 2018-2024 Mexico’s National Development Plan. Revista Internacional De Cooperaci Y Desarrollo, 8(1), 28–38.

https://doi.org/10.21500/23825014.5206

Rivera-Aguilera, G., Lobos-Pessini, J., y Bork, A. (2020). Espacios organizacionales en la producci de jenes trabajadores chilenos. Innovar: Revista de Ciencias Administrativas y Sociales, 30(78), 105– 118. https://doi.org/10.15446/innovar.v30n78.90301

Robles, A., y Valle, E. (2016).Condiciones del trabajo estudiantilurbano y abandono escolar en el nivelmedio superior en México. Estudios Demográficos y Urbanos, 31(3 (93)), 663–696.

http://www.jstor.org/stable/24890654

Rodríguez, A., de-Juanas, A.,yGonzález, A.,(2016). Atribuciones de los jenes en situaci de vulnerabilidad social sobre los beneficios del estudio y la inserci laboral. Revista Espaola de Pedagogía, 74(263), 109– 126. http://www.jstor.org/stable/24711271

Rosas, L. A. A., y Jiménez-Bandala, C. A. (2018). El desempleo y la probabilidad de caer en trampas de pobreza-Unemployment and the Probability of Falling into Poverty Traps: consideraciones para países en vías de desarrollo. Reis: Revista Espaola de Investigaciones Sociolgicas, 164, 3–20.

http://dx.doi.org/10.5477/cis/reis.164.3

Roth, A. E. (1984). The Evolution of the Labor Market for Medical Interns and Residents: A Case Study in Game Theory. Journal of Political Economy, 92(6), 991–1016. http://www.jstor.org/stable/1831989

Roth, A. E., & Wilson, R. B. (2019). How Market Design Emerged from Game Theory: A Mutual Interview. The Journal of Economic Perspectives, 33(3), 118–143. http://doi.org/10.1257/jep.33.3.118

Sen, A. (1999). Development as Freedom, Anchor Books, New York, pp. 384

Silva,E. M. (2016).Empleo, desempleo e identidadesde los trabajadores despedidosdel sistema siderrgico mexicano. Estudios Sociolgicos, 34(101), 383–406. http://www.jstor.org/stable/24890870

Vacchiano, M., Martí, J., Yepes-Cayuela, L., y Verd, J. M. (2018). Las redes personales en la inserci laboral juvenil en tiempos de crisis. Un análisis en Barcelona / Personal Networks in Job Insertion among Young Adults in Times of Crisis: An Analysis in Barcelona. Reis: Revista Espala de Investigaciones Sociolgicas, 161, 121–139. http://dx.doi.org/10.5477/cis/reis.161.121

Zenteno-Hidalgo, Á. C., y Silva, C. A. D. (2016). Factores y prácticas de alto desempeo que influyen en el clima laboral: análisis de un caso. Innovar: Revista de Ciencias Administrativas y Sociales, 26(59), 119–136.

http://dx.doi.org/10.15446/innovar.v26n59.54367