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Learning from the Great Divergence in unemployment in Europe during the crisis

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  • Boeri, Tito
  • Jimeno, Juan F.

Abstract

Since the mid-2000s there has been an increasing divergence in unemployment rates across EU countries and age groups. We argue that this divergence has to do with labor market institutions when account is made of their interactions with the magnitude and nature of the shocks from the Great Recession and the Eurozone debt crisis. New macro and micro evidence is provided highlighting the importance of these interactions in explaining cross-country differences in labor market adjustment to shocks. Having identified the labor market institutions responsible for this increasing unemployment divergence, we consider what can be done at the EU level to promote institutional convergence. In particular, we discuss a “positive conditionality” approach that could operate also in good times, and not only under recessions, when conditionality is strong, but some reforms may backfire.

Suggested Citation

  • Boeri, Tito & Jimeno, Juan F., 2016. "Learning from the Great Divergence in unemployment in Europe during the crisis," Labour Economics, Elsevier, vol. 41(C), pages 32-46.
  • Handle: RePEc:eee:labeco:v:41:y:2016:i:c:p:32-46
    DOI: 10.1016/j.labeco.2016.05.022
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    References listed on IDEAS

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    Citations

    Blog mentions

    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. Sucedió (o no) en Gotemburgo
      by Juan Francisco Jimeno in Nada Es Gratis on 2017-11-28 12:07:37
    2. Reformas estructurales 2.0
      by Juan Francisco Jimeno in Nada Es Gratis on 2018-03-23 06:07:56

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    Cited by:

    1. Jesus Ferreiro & Carmen Gómez, 2018. "Employment protection and labour market performance in European Union countries during the Great Recession," FMM Working Paper 31-2018, IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute.
    2. repec:pal:imfecr:v:66:y:2018:i:1:d:10.1057_s41308-017-0045-1 is not listed on IDEAS
    3. Tingyun Chen & Jean-Jacques Hallaert & Alexander Pitt & Haonan Qu & Maximilien Queyranne & Alaina Rhee & Anna Shabunina & Jérôme Vandenbussche & Irene Yackovlev, 2018. "Inequality and Poverty across Generations in the European Union," IMF Staff Discussion Notes 18/01, International Monetary Fund.
    4. repec:eee:labeco:v:50:y:2018:i:c:p:144-155 is not listed on IDEAS
    5. Bassanini, Andrea & Cingano, Federico, 2017. "Before It Gets Better: The Short-Term Employment Costs of Regulatory Reforms," IZA Discussion Papers 11011, Institute for the Study of Labor (IZA).
    6. Mikel Casares & Jesús Vázquez, 2016. "Why are labor markets in Spain and Germany so different?," Documentos de Trabajo - Lan Gaiak Departamento de Economía - Universidad Pública de Navarra 1602, Departamento de Economía - Universidad Pública de Navarra.
    7. Jan Babecky & Kamil Galuscak & Diana Zigraiova, 2017. "Wage Dynamics and Financial Performance: Evidence from Czech Firms," Working Papers 2017/14, Czech National Bank, Research Department.
    8. Savšek, Simon, 2018. "What are the main obstacles to hiring after recessions in Europe?," Working Paper Series 2153, European Central Bank.

    More about this item

    Keywords

    Unemployment; Labor market institutions; Demand and financial shocks;

    JEL classification:

    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search

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