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Who Benefits from Labor Market Regulations? Chile, 1960-1998

In: Law and Employment: Lessons from Latin America and the Caribbean

  • Claudio E. Montenegro
  • Carmen Pagés

Economists have examined the impact of labor market regulations on the level of employment. However, there are many reasons to suspect that the impact of regulations differs across types of workers. In this paper we take advantage of the unusually large variance in labor policy in Chile to examine how different labor market regulations affect the distribution of employment and the employment rates across age, gender and skill levels. To this effect, we use a sample of repeated cross-section household surveys spanning the period 1960-1998 and measures of the evolution of job security provisions and minimum wages across time. Our results suggest large distribution effects. We find that employment security provisions and minimum wages reduce the share of youth and unskilled employment as well as their employment rates. We also find large effects on the distribution of employment between women and men.

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This chapter was published in:
  • James J. Heckman & Carmen Pagés, 2004. "Law and Employment: Lessons from Latin America and the Caribbean," NBER Books, National Bureau of Economic Research, Inc, number heck04-1, May.
  • This item is provided by National Bureau of Economic Research, Inc in its series NBER Chapters with number 10074.
    Handle: RePEc:nbr:nberch:10074
    Contact details of provider: Postal: National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.
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