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Reforming an Insider-Outsider Labor Market: The Spanish Experience

  • Bentolila, Samuel


    (CEMFI, Madrid)

  • Dolado, Juan J.


    (European University Institute)

  • Jimeno, Juan F.


    (Bank of Spain)

This paper presents a case study on reforming a very dysfunctional labor market with a deep insider-outsider divide, namely the Spanish case. We show how a dual market, with permanent and temporary employees makes real reform much harder, and leads to purely marginal changes that do not alter the fundamental features of labor market institutions. While the Great Recession and the start of the sovereign debt crisis triggered two labor reforms, the political economy equilibrium has not allowed them to be transformational enough.

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Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 6186.

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Length: 46 pages
Date of creation: Dec 2011
Date of revision:
Publication status: published in: IZA Journal of European Labor Studies, 2012, 1:4
Handle: RePEc:iza:izadps:dp6186
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References listed on IDEAS
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  1. Bentolila, Samuel & Cahuc, Pierre & Dolado, Juan J. & Le Barbanchon, Thomas, 2010. "Two-Tier Labor Markets in the Great Recession: France vs. Spain," IZA Discussion Papers 5340, Institute for the Study of Labor (IZA).
  2. Juan J Dolado & Carlos Garcia--Serrano & Juan F. Jimeno, 2002. "Drawing Lessons From The Boom Of Temporary Jobs In Spain," Economic Journal, Royal Economic Society, vol. 112(721), pages F270-F295, June.
  3. Dolado, Juan J. & Ortigueira, Salvador & Stucchi, Rodolfo, 2012. "Does dual employment protection affect TFP? Evidence from Spanish manufacturing firms," CEPR Discussion Papers 8763, C.E.P.R. Discussion Papers.
  4. James Costain & Juan F. Jimeno & Carlos Thomas, 2010. "Employment fluctuations in a dual labor market," Banco de Espa�a Working Papers 1013, Banco de Espa�a.
  5. Samuel Bentolila & Juan Jose Dolado & Juan F. Jimeno, 2008. "Two-tier Employment Protection Reforms: The Spanish Experience," CESifo DICE Report, Ifo Institute for Economic Research at the University of Munich, vol. 6(4), pages 49-56, December.
  6. Saint-Paul, Gilles, 2000. "The Political Economy of Labour Market Institutions," OUP Catalogue, Oxford University Press, number 9780198293323, July.
  7. Juan F. Jimeno & Carlos Thomas, 2011. "Collective bargaining, firm heterogeneity and unemployment," Banco de Espa�a Working Papers 1131, Banco de Espa�a.
  8. José Ignacio Conde Ruiz & Florentino Felgueroso & Jose Ignacio García Pérez, 2011. "Reforma Laboral 2010: Una primera evaluación y propuestas de mejora," Economic Reports 01-2011, FEDEA.
  9. Samuel Bentolila & Juan F. Jimeno, 2003. "Spanish Unemployment: The End of the Wild Ride?," CESifo Working Paper Series 940, CESifo Group Munich.
  10. Jose Ignacio García Pérez & Victoria Osuna, 2011. "The effects of introducing a single open-ended contract in the Spanish labour market," Working Papers 11.07, Universidad Pablo de Olavide, Department of Economics.
  11. repec:oup:qjecon:v:105:y:1990:i:3:p:699-726 is not listed on IDEAS
  12. Ángel Gavilán & Pablo Hernández de Cos & Juan F. Jimeno & Juan A. Rojas, 2011. "Fiscal policy, structural reforms and external imbalances: a quantitative evaluation for Spain," Banco de Espa�a Working Papers 1107, Banco de Espa�a.
  13. Martin Werding (ed.), 2006. "Structural Unemployment in Western Europe: Reasons and Remedies," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262232464, June.
  14. Duval, Romain & Elmeskov, Jørgen, 2006. "The effects of EMU on structural reforms in labour and product markets," Working Paper Series 0596, European Central Bank.
  15. Alfonso ARPAIA & Nicola CURCI, . "EU labour market behaviour during the Great Recession," Working Papers wp2010-6, Department of the Treasury, Ministry of the Economy and of Finance.
  16. Yolanda Rebollo Sanz & J. Ignacio García-Pérez, 2009. "Do wage subsidies affect the subsequent employment stability of permanent workers?: the case of Spain," Working Papers 09.18, Universidad Pablo de Olavide, Department of Economics.
  17. Juan José Dolado & Florentino Felgueroso & Marcel Jansen, 2010. "El conflicto entre la demanda de flexibilidad laboral y la resistencia a la reforma del mercado de trabajo en España," Economic Reports 06-2010, FEDEA.
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