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Labour market reforms since the crisis drivers and consequences

Author

Listed:
  • Adascalitei, Dragos.
  • Pignatti Morano, Clemente.

Abstract

The paper analyses the determinants and effects of reforms of employment protection legislation (EPL), using a novel inventory that covers 111 developed and developing countries between 2008 and 2014. The analysis finds that in developed economies, reforms were mostly directed towards relaxing labour regulation and were driven by high unemployment rates and low levels of GDP growth. By contrast, in developing economies reforms tended to increase workers’ protection and were more likely to occur in countries experiencing high levels of GDP growth – while not being sensitive to unemployment rates. Furthermore, we test the effects of these reforms on labour market outcomes. We find that deregulation decreases employment rates in both developed and developing countries in the year after implementation. Deregulation also increases unemployment rates in developed economies in the short-term; but the effect is not statistically significant in developing countries.

Suggested Citation

  • Adascalitei, Dragos. & Pignatti Morano, Clemente., 2015. "Labour market reforms since the crisis drivers and consequences," ILO Working Papers 994889613402676, International Labour Organization.
  • Handle: RePEc:ilo:ilowps:994889613402676
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    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
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    Cited by:

    1. Dosi, G. & Pereira, M.C. & Roventini, A. & Virgillito, M.E., 2017. "When more flexibility yields more fragility: The microfoundations of Keynesian aggregate unemployment," Journal of Economic Dynamics and Control, Elsevier, vol. 81(C), pages 162-186.
    2. Dragos Adascalitei & Sameer Khatiwada & Miguel Á. Malo & Pignatti Moran, 2015. "Employment protection and collective bargaining during the great recession: a comprehensive review of international evidence," Revista de Economía Laboral - Spanish Journal of Labour Economics, Asociación Española de Economía Laboral - AEET, vol. 12, pages 50-87.
    3. Giovanni Dosi & Marcelo C. Pereira & Andrea Roventini & Maria Enrica Virgillito, 2016. "The Effects of Labour Market Reforms upon Unemployment and Income Inequalities: an Agent Based Model," Sciences Po publications 2016-24, Sciences Po.
    4. repec:ers:journl:v:xxi:y:2018:i:3:p:206-217 is not listed on IDEAS
    5. repec:eee:streco:v:44:y:2018:i:c:p:34-45 is not listed on IDEAS
    6. Agénor, Pierre-Richard & Lim, King Yoong, 2018. "Unemployment, growth and welfare effects of labor market reforms," Journal of Macroeconomics, Elsevier, vol. 58(C), pages 19-38.
    7. Chiliatto-Leite, Marcos Vinicius, 2017. "Densidade de contribuição na previdência social do Brasil," Estudios y Perspectivas – Oficina de la CEPAL en Brasilia 3, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
    8. Giovanni Dosi & Marcelo C. Pereira & Andrea Roventini & Maria Enrica Virgillito, 2016. "The Effects of Labour Market Reforms upon Unemployment and Income Inequalities: an Agent Based Model," LEM Papers Series 2016/27, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
    9. repec:bla:jecsur:v:32:y:2018:i:1:p:83-117 is not listed on IDEAS

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