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Labour Market Policy and the Reallocation of Labour Across Sectors

  • Richard Jackman
  • C Pauna

This paper investigates the extent of labour market allocation across broad industrial sectors in the transition of economies of Eastern Europe since 1989. It offers various measures of the magnitude of labour misallocation and of the speed and efficiency of reallocation during the first half of the 1980s. It compares the performance of the economies of Eastern Europe with one another and with two Southern European economies, Greece and Portugal, which have also been experiencing substantial economic change. Contrary to much a pirori theorising, the paper finds no correlation between unemployment and the speed or effectiveness of labour market reallocation. The authors argue that the analysis in the paper strengthens the case for an active as against a passive approach to labour market policy.

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File URL: http://cep.lse.ac.uk/pubs/download/DP0338.pdf
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Paper provided by Centre for Economic Performance, LSE in its series CEP Discussion Papers with number dp0338.

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Date of creation: Mar 1997
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Handle: RePEc:cep:cepdps:dp0338
Contact details of provider: Web page: http://cep.lse.ac.uk/_new/publications/series.asp?prog=CEP

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  1. Hare, Paul G & Hughes, Gordon, 1992. "Industrial Policy and Restructuring in Eastern Europe," CEPR Discussion Papers 653, C.E.P.R. Discussion Papers.
  2. Blanchard, Olivier Jean & Aghion, Philippe, 1994. "On the Speed of Transition in Central Europe," Scholarly Articles 4481322, Harvard University Department of Economics.
  3. T. Boeri & M. C. Burda, 1995. "Active Labor Market Policies, Job Matching and the Czech Miracle," SFB 373 Discussion Papers 1995,76, Humboldt University of Berlin, Interdisciplinary Research Project 373: Quantification and Simulation of Economic Processes.
  4. I Beleva & Richard Jackman & M Nenova-Amar, 1995. "The Labour Market in Bulgaria," CEP Discussion Papers dp0268, Centre for Economic Performance, LSE.
  5. Puhani, Patrick A. & Steiner, Viktor, 1996. "Public works for Poland? Active labour market policies during transition," ZEW Discussion Papers 96-01, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  6. Philippe Aghion & Olivier Jean Blanchard, 1994. "On the Speed of Transition Central Europe," NBER Working Papers 4736, National Bureau of Economic Research, Inc.
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