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Labor policies and capital mobility in theory and in EMU

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  • Bertola, Giuseppe

Abstract

Europe׳s Economic and Monetary Union (EMU) was characterized by large international imbalances and uneven national labor market reforms. In this paper׳s model, labor policies that aim to increase the welfare of capital-poor individuals within each country are influenced by financial integration across differently capital-abundant countries. The model predicts that capital outflows should be associated with labor market deregulation, as was the case in EMU, and helps interpret inequality developments and policy tensions in that experience.

Suggested Citation

  • Bertola, Giuseppe, 2016. "Labor policies and capital mobility in theory and in EMU," European Economic Review, Elsevier, vol. 87(C), pages 62-77.
  • Handle: RePEc:eee:eecrev:v:87:y:2016:i:c:p:62-77
    DOI: 10.1016/j.euroecorev.2016.04.007
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    References listed on IDEAS

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    1. Bertola, Giuseppe, 1993. "Factor Shares and Savings in Endogenous Growth," American Economic Review, American Economic Association, vol. 83(5), pages 1184-1198, December.
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    Cited by:

    1. Bertola, Giuseppe, 2017. "European unemployment revisited: Shocks, institutions, integration," Research in Economics, Elsevier, vol. 71(3), pages 588-612.
    2. Bertola, Giuseppe, 2017. "Wedges: Distribution, Distortions, and Market Integration," CEPR Discussion Papers 11980, C.E.P.R. Discussion Papers.
    3. Giuseppe Bertola, 2017. "Wedges: Distribution, Distortions, and Market Integration," CESifo Working Paper Series 6627, CESifo Group Munich.

    More about this item

    Keywords

    Policy competition; Politico-economic equilibrium;

    JEL classification:

    • F2 - International Economics - - International Factor Movements and International Business
    • J08 - Labor and Demographic Economics - - General - - - Labor Economics Policies

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