Unemployment and finance: how do financial and labour market factors interact?
AbstractUsing data for 18 OECD countries over the period 1980-2004, we investigate how labour and financial factors interact to determine unemployment. We show that the impact of financial variables depends strongly on the labour market context. Increased market capitalization as well as decreased banking concentration reduce unemployment if the level of labour market regulation, union density and coordination in wage bargaining is low. The above financial variables have no effect otherwise. Increasing intermediated credit worsens unemployment when the labour market is weakly regulated and coordinated, whereas it reduces unemployment otherwise. These results suggest that the respective virtues of bank-based and market-based finance are crucially tied to the strength of labour regulation.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by HAL in its series CEPN Working Papers with number halshs-00566792.
Date of creation: Mar 2009
Date of revision:
Note: View the original document on HAL open archive server: http://halshs.archives-ouvertes.fr/halshs-00566792
Contact details of provider:
Web page: http://hal.archives-ouvertes.fr/
unemployment ; institutional complementarities and substituabilities ; labour market ; financial system;
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Nicolas Dromel & Elie Kolakez & Etienne Lehmann, 2009.
"Credit Constraints and the Persistence of Unemployment,"
UniversitÃ© Paris1 PanthÃ©on-Sorbonne (Post-Print and Working Papers)
- Dromel, Nicolas L. & Kolakez, Elie & Lehmann, Etienne, 2010. "Credit constraints and the persistence of unemployment," Labour Economics, Elsevier, vol. 17(5), pages 823-834, October.
- Dromel, Nicolas & Kolakez, Elie & Lehmann, Etienne, 2009. "Credit Constraints and the Persistence of Unemployment," IZA Discussion Papers 4501, Institute for the Study of Labor (IZA).
- repec:hal:journl:halshs-00389762 is not listed on IDEAS
- Donatella Gatti & Anne-Gael Vaubourg, 2010. "Credit and Unemployment: Do Institutions Matter?," CESifo Forum, Ifo Institute for Economic Research at the University of Munich, vol. 11(1), pages 37-43, 04.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (CCSD).
If references are entirely missing, you can add them using this form.