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Youth Unemployment in the OECD: The Role of Institutions

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  • Sachs Andreas

    (Prognos AG, Europäisches Zentrum für Wirtschaftsforschung und Strategieberatung, Nymphenburger Str. 14/2. OG, 80335 München, Germany)

  • Smolny Werner

    (University of Ulm, 89081 Ulm, Germany)

Abstract

This paper analyzes the role of labor market institutions for youth unemployment, as contrasted to total unemployment. The empirical results are basically consistent with an insider view of labor market institutions. Labor market institutions tend to protect (older) employees but might harm (young) entrants. Remarkable is especially the significant and very high effect of employment protection for regular jobs on youth unemployment. In addition, the combined effects of powerful unions and a coordinated wage bargaining system are beneficial for older people and detrimental to youth. Finally, the paper identifies a significant link between a demographic as well as an educational factor and both youth and total unemployment.

Suggested Citation

  • Sachs Andreas & Smolny Werner, 2015. "Youth Unemployment in the OECD: The Role of Institutions," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 235(4-5), pages 403-417, August.
    • Handle: RePEc:jns:jbstat:v:235:y:2015:i:4-5:p:403-417
    DOI: 10.1515/jbnst-2015-4-505
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    1. Youth unemployment in the OECD: The role of institutions
      by maximorossi in NEP-LTV blog on 2014-12-19 16:58:12

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    Cited by:

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    2. Carsten Ochsen, 2021. "Age cohort effects on unemployment in the USA: Evidence from the regional level," Papers in Regional Science, Wiley Blackwell, vol. 100(4), pages 1025-1053, August.
    3. Süheyla Erikli & Serap Pelin Türkoğlu, 2021. "OECD Ülkelerinin İşgücü Piyasası Performans Analizi," Journal of Social Policy Conferences, Istanbul University, Faculty of Economics, vol. 0(80), pages 299-320, June.
    4. Damir STIJEPIC, 2020. "Employment effects of skills around the world: Evidence from the PIAAC," International Labour Review, International Labour Organization, vol. 159(3), pages 307-338, September.
    5. Fitzenberger Bernd & Gürtzgen Nicole & Pfeiffer Friedhelm, 2015. "Guest Editorial," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 235(4-5), pages 352-354, August.

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    More about this item

    Keywords

    Youth unemployment; labor market institutions; age-specific unemployment;
    All these keywords.

    JEL classification:

    • E02 - Macroeconomics and Monetary Economics - - General - - - Institutions and the Macroeconomy
    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J68 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Public Policy

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