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Supply-side labour market reforms: a neglected cause of the productivity crisis

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  • Alfred Kleinknecht

Abstract

In spite of impressive stories about a Second Machine Age or Industry 4.0, growth rates of labor productivity in the US, Japan and Western Europe declined, during the last 10-15 years, to their lowest levels since World War II. Recent contributions on the productivity slowdown by mainstream economists produced an impressive amount of statistical data that certainly add to our understanding, but they fail addressing the negative impact of supply-side labor market reforms on innovation and productivity. I present theoretical arguments of how labor market deregulation can negatively influence innovation and productivity growth and I review empirical evidence.

Suggested Citation

  • Alfred Kleinknecht, 2017. "Supply-side labour market reforms: a neglected cause of the productivity crisis," Working Papers 0027, ASTRIL - Associazione Studi e Ricerche Interdisciplinari sul Lavoro.
    • Handle: RePEc:ast:wpaper:0027
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    More about this item

    Keywords

    Varieties of capitalism; structural reforms of lab or markets; innovation; productivity crisis;
    All these keywords.

    JEL classification:

    • J53 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Labor-Management Relations; Industrial Jurisprudence
    • K31 - Law and Economics - - Other Substantive Areas of Law - - - Labor Law
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives

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