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A labour market extension for WorldScan; modelling labour supply, wage bargaining and unemployment in a CGE framework


  • Stefan Boeters


  • Nico van Leeuwen



This paper describes a labour market extension for the CGE model "WorldScan". The labour market module features endogenous labour supply at two margins: participation and hours of work. Involuntary unemployment is captured through a collective bargaining ("right to manage") set-up. The paper explains how these two labour market mechanisms interact and how they are calibrated to empirical elasticities. Illustrative simulations that can be placed in the context of the "double dividend" literature show the working mechanisms of the module.

Suggested Citation

  • Stefan Boeters & Nico van Leeuwen, 2010. "A labour market extension for WorldScan; modelling labour supply, wage bargaining and unemployment in a CGE framework," CPB Document 201, CPB Netherlands Bureau for Economic Policy Analysis.
  • Handle: RePEc:cpb:docmnt:201

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    References listed on IDEAS

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    Cited by:

    1. Persyn, Damiaan & Torfs, Wouter & Kancs, d’Artis, 2014. "Modelling regional labour market dynamics: Participation, employment and migration decisions in a spatial CGE model for the EU," INVESTIGACIONES REGIONALES - Journal of REGIONAL RESEARCH, Asociación Española de Ciencia Regional, issue 29, pages 77-90.
    2. Stefan Boeters & Luc Savard, 2011. "The Labour Market in CGE Models," Cahiers de recherche 11-20, Departement d'Economique de l'École de gestion à l'Université de Sherbrooke.
    3. d'Artis Kancs & Patrizio Lecca, 2016. "Long-term social, economic and fiscal effects of immigration into the EU: The role of the integration policy," EERI Research Paper Series EERI RP 2016/08, Economics and Econometrics Research Institute (EERI), Brussels.
    4. Boeters, Stefan & Savard, Luc, 2013. "The Labor Market in Computable General Equilibrium Models," Handbook of Computable General Equilibrium Modeling, Elsevier.

    More about this item

    JEL classification:

    • C68 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computable General Equilibrium Models
    • D58 - Microeconomics - - General Equilibrium and Disequilibrium - - - Computable and Other Applied General Equilibrium Models
    • J20 - Labor and Demographic Economics - - Demand and Supply of Labor - - - General
    • J50 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - General

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