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The dynamics of the labor markets in Chile

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Author Info
Víctor O. Lima
Ricardo D. Paredes ()

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Abstract

Through flows from 3 states, employment, unemployment and out of the labor force, we analyze the dynamics of labor markets in Chile from 1962-2007. We identify some periods of different labor market regimes and relate them with changes in flexibility. We found that reforms such as that of 1967, which introduced the “just cause” requirement to fire workers, did not help workers to keep their jobs, but there is no evidence of significant changes in inflexibility. Other labor regimes significantly affected transitions, but surprisingly, it was the new regime identified in 1990, that increased mobility. We interpret this as the result of the consolidation of a flexibility prone model that, until then, had been associated with an unpopular imposition by the military regime. Finally, we do not find any evidence showing that after 1998 the changes in labor participation and consequently, that the explanations of the changes in the unemployment rate could be associated with “added and discouraged worker eff

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File URL: http://econ.uchile.cl/public/Archivos/pub/d10ba1bd-4342-4ea7-a0da-32499d13f4b6.pdf
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Publisher Info
Article provided by University of Chile, Department of Economics in its journal Estudios de Economia.

Volume (Year): 34 (2007)
Issue (Month): 2 Year 2007 (December)
Pages: 163-183
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Handle: RePEc:udc:esteco:v:34:y:2007:i:2:p:163-183

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Web page: http://www.econ.uchile.cl/
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Related research
Keywords: Labor markets; transition probabilities; unemployment.;

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Find related papers by JEL classification:
J38 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Public Policy
J63 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - Turnover; Vacancies; Layoffs

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  1. Di Tella, Rafael & MacCulloch, Robert, 2005. "The consequences of labor market flexibility: Panel evidence based on survey data," European Economic Review, Elsevier, vol. 49(5), pages 1225-1259, July. [Downloadable!] (restricted)
  2. Karanassou, Marika & Snower, Dennis J., 1998. "How Labour Market Flexibility Affects Unemployment: Long-Term Implications of the Chain Reaction Theory," CEPR Discussion Papers 1826, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
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  3. James J. Heckman & Carmen Pages, 2000. "The Cost of Job Security Regulation: Evidence from Latin American Labor Markets," NBER Working Papers 7773, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  4. Claudio Montenegro & Carmen Pages, 2003. "Who Benefits from Labor Market Regulations? Chile 1960-1998," NBER Working Papers 9850, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  5. Erik Haindl R., 1985. "Un modelo para la determinación de flujos y parámetros dinámicos en el mercado del trabajo," Estudios de Economia, University of Chile, Department of Economics, vol. 12(1 Year 19), pages 27-48, June. [Downloadable!]
  6. Claudio Sapelli, 1996. "Modelos para Pensar el Mercado de Trabajo: Una Revisión de la Literatura Chilena," Cuadernos de Economía (Latin American Journal of Economics), Instituto de Economía. Pontificia Universidad Católica de Chile., vol. 33(99), pages 251-276. [Downloadable!]
  7. Alvaro Forteza & Martín Rama, 2000. "Labor Market "Rigidity" and the Success of Economic Reforms Across more than One Hundred Countries," Documentos de Trabajo (working papers) 0600, Department of Economics - dECON. [Downloadable!]
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  8. Dr. Peter Kenning & Hilke Plassmann, 2004. "NeuroEconomics," Experimental 0412005, EconWPA. [Downloadable!]
  9. Timothy Besley & Robin Burgess, 2004. "Can Labor Regulation Hinder Economic Performance? Evidence from India," The Quarterly Journal of Economics, MIT Press, vol. 119(1), pages 91-134, February. [Downloadable!] (restricted)
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