The Impact of Labor Market Reforms on Capital Flows, Wages and Unemployment
Abstract
The paper contributes to the globalization debate by scrutinizing the international spillover effects which are provoked if a single country reduces the generosity of the unemployment compensation system or weakens labor union power. For this purpose a two-country model with imperfect competition in goods and labor markets and perfect competition in capital markets is developed. It is demonstrated that the comparative-static results depend on the degree of capital mobility, the degree of competition in the goods market and the institutional setup of the unemployment compensation system. Furthermore, it is shown that the impact of country-specific labor market reforms on households in other countries depends on whether the household’s main income source consists of wage income or capital income and profits.Download Info
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Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 390.Length: 35 pages
Date of creation: Nov 2001
Date of revision:
Handle: RePEc:iza:izadps:dp390
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Related research
Keywords: Globalization; capital mobility; unemployment; unemployment compensation; wage bargaining; monopolistic competition; welfare state;Other versions of this item:
- Beissinger, Thomas, 2002. "The Impact of Labor Market Reforms on Capital Flows, Wages and Unemployment," Royal Economic Society Annual Conference 2002 18, Royal Economic Society.
- E24 - Macroeconomics and Monetary Economics - - Macroeconomics: Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution
- F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
- F41 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Open Economy Macroeconomics
- J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
- J51 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Trade Unions: Objectives, Structure, and Effects
- J65 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - Unemployment Insurance; Severance Pay; Plant Closings
This paper has been announced in the following NEP Reports:
- NEP-ALL-2001-11-21 (All new papers)
- NEP-IFN-2001-11-21 (International Finance)
- NEP-LAB-2001-11-21 (Labour Economics)
References
References listed on IDEASPlease 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.:
- Daron Acemoglu & Steve Pischke, 1999.
"Minimum Wages and On-the-Job Training,"
Working papers
99-25, Massachusetts Institute of Technology (MIT), Department of Economics.
- Acemoglu, Daron & Pischke, Jörn-Steffen, 2001. "Minimum Wages and On-the-Job Training," IZA Discussion Papers 384, Institute for the Study of Labor (IZA).
- Daron Acemoglu & Jörn-Steffen Pischke, 2002. "Minimum Wages and On-the-Job Training," CEP Discussion Papers dp0527, Centre for Economic Performance, LSE.
- Acemoglu, Daron & Pischke, Jörn-Steffen, 1999. "Minimum Wages and On-the-Job Training," CEPR Discussion Papers 2177, C.E.P.R. Discussion Papers.
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"The Effect of Employment Protection on Worker Effort. A Comparison of Absenteeism During and After Probation,"
CESifo Working Paper Series
596, CESifo Group Munich.
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- Ichino, Andrea & Riphahn, Regina, 2003. "The Effect of Employment Protection on Worker Effort: A Comparison of Absenteeism During and After Probation," CEPR Discussion Papers 3847, C.E.P.R. Discussion Papers.
- Trejo, Stephen, 2001.
"Intergenerational Progress of Mexican-Origin Workers in the U.S. Labor Market,"
IZA Discussion Papers
377, Institute for the Study of Labor (IZA).
- Stephen J. Trejo, 2003. "Intergenerational Progress of Mexican-Origin Workers in the U.S. Labor Market," Journal of Human Resources, University of Wisconsin Press, vol. 38(3).
- Addison, John T. & Teixeira, Paulino, 2001.
"The Economics of Employment Protection,"
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381, Institute for the Study of Labor (IZA).
- John T. Addison & Paulino Teixeira, 2003. "The Economics of Employment Protection," Journal of Labor Research, Transaction Publishers, vol. 24(1), pages 85-129, January.
- David Blau & Erdal Tekin, 2003.
"The Determinants and Consequences of Child Care Subsidies for Single Mothers,"
NBER Working Papers
9665, National Bureau of Economic Research, Inc.
- Blau, David M. & Tekin, Erdal, 2001. "The Determinants and Consequences of Child Care Subsidies for Single Mothers," IZA Discussion Papers 383, Institute for the Study of Labor (IZA).
Citations
Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.Cited by:
- Schmerer, Hans-Jörg, 2012. "FDI, skill-specific unemployment, and institutional spillover effects," Economics Discussion Papers 2012-2, Kiel Institute for the World Economy.
- Pica Giovanni, 2010.
"Capital Markets Integration and Labor Market Institutions,"
The B.E. Journal of Macroeconomics,
De Gruyter, vol. 10(1), pages 1-57, March.
- Giovanni Pica, 2005. "Capital Markets Integration and Labor Market Institutions," CSEF Working Papers 144, Centre for Studies in Economics and Finance (CSEF), University of Naples, Italy, revised 01 Nov 2007.
- Schmerer, Hans-Jörg, 2012.
"Skill-biased labor market reforms and international competitiveness,"
IAB Discussion Paper
201224, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
- Schmerer, Hans-Jörg, 2012. "Skill-biased labor market reforms and international competitiveness," Economics - The Open-Access, Open-Assessment E-Journal, Kiel Institute for the World Economy, vol. 6(37), pages 1-39.
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