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Sectoral Structure and Entry Regulations

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Author Info
Messina, Julian (European Central Bank)

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Abstract

The sectoral allocation of labor differs considerably across developed economies, even in the presence of similar patterns of structural change. A general equilibrium model that captures the stylized facts of structural change is presented. In this framework, economy-wide barriers to entry hinder the development of dynamic sectors such as service industries. Moreover, higher service prices and rents in regulated economies reduce labor supply, providing a rationale for the negative association between product market regulations and the employment rate previously found in the literature. Empirical evidence presented shows that regulatory entry barriers help explaining differences in the sectoral allocation of labor across OECD countries.

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Paper provided by Royal Economic Society in its series Royal Economic Society Annual Conference 2003 with number 154.

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Date of creation: 04 Jun 2003
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Handle: RePEc:ecj:ac2003:154

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Web page: http://www.res.org.uk/society/annualconf.asp
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Related research
Keywords: unbalanced growth; entry regulations;

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Find related papers by JEL classification:
O11 - Economic Development, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
O41 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models
L5 - Industrial Organization - - Regulation and Industrial Policy

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  3. Djankov, Simeon & La Porta, Rafael & López-de-Silanes, Florencio & Shleifer, Andrei, 2001. "The Regulation of Entry," CEPR Discussion Papers 2953, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
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  4. Richard B. Freeman & Ronald Schettkat, 2002. "Marketization of Production and the US-Europe Employment Gap," NBER Working Papers 8797, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  13. Steven Saeger, 1997. "Globalization and deindustrialization: Myth and reality in the OECD," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 133(4), pages 579-608, December. [Downloadable!] (restricted)
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  16. Julian Messina, 2003. "The role of product market regulations in the process of structural change," Working Paper Series 217, European Central Bank. [Downloadable!]
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  17. Blanchard, Olivier J & Giavazzi, Francesco, 2001. "Macroeconomic Effects of Regulation and Deregulation in Goods and Labour Markets," CEPR Discussion Papers 2713, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Adriana Kugler & Giovanni Pica, 2003. "Effects of Employment Protection and Product Market Regulations on the Italian Labor Market," Economics Working Papers 722, Department of Economics and Business, Universitat Pompeu Fabra. [Downloadable!]
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  2. Kugler, Adriana & Pica, Giovanni, 2003. "The Effects Of Employment Protection and Product Market Regulations on The Italian Labor Market," Discussion Paper Series In Economics And Econometrics 0310, Economics Division, School of Social Sciences, University of Southampton. [Downloadable!]
    Other versions:
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