IDEAS home Printed from
MyIDEAS: Log in (now much improved!) to save this paper

Shaping persistent earnings inequality: labour market policy and institutional factors

Listed author(s):
  • SOLOGON Denisa
  • O'DONOGHUE Cathal

This paper explores the role of labour market policy and institutional factors in explaining cross-national differences in persistent earnings inequality in Europe. Using non-linear least squares we reveal a complex framework, where institutions and their systemic interactions play a decisive role in shaping persistent inequality. "Piece-meal" reforms appear more effective in reducing persistent inequality than comprehensive policy packages: a substitution effect in reducing persistent inequality emerges between labour market deregulation, deunionization, the transition from a decentralized to a corporatist economy, increasing tax wedge, product market deregulation, increasing active labour market policies, and decreasing generosity of the unemployment benefit. Under special conditions, however, some complementarity effects do emerge. Moreover, the effect of each reform depends on the institutional mix. High corporatism emerges as the most effective tool in reducing the adverse effects of macroeconomic shocks on persistent inequality.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL:
Download Restriction: no

Paper provided by LISER in its series LISER Working Paper Series with number 2011-22.

in new window

Length: 40 pages
Date of creation: Feb 2011
Handle: RePEc:irs:cepswp:2011-22
Contact details of provider: Postal:
11, Porte des Sciences, L-4366 Esch-sur-Alzette, G.-D. Luxembourg

Phone: 00352 / 58 58 55 - 1
Fax: 00352 / 58 58 55 - 700
Web page:

More information through EDIRC

No references listed on IDEAS
You can help add them by filling out this form.

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:irs:cepswp:2011-22. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Library and Documentation)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.