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Institutional Determinants of Worker Flows: A Cross-Country/Cross-Industry Approach

Author

Listed:
  • Andrea Bassanini

    (OECD)

  • Andrea Garnero
  • Pascal Marianna

    (OECD)

  • Sébastien Martin

    (OECD)

Abstract

There is little cross-country comparative evidence on the way labour market institutions shape gross job and worker flows, by and large because comparable data for many countries are scarce. By using a unique harmonised dataset on hirings and separations at the industry-level for a large majority of OECD countries, we fill this gap, by analysing the role of a number of labour and product market institutions in shaping cross-country differences in gross worker flows. In order to identify the effect of policies and institutions we consider an industry-level difference-in-difference approach. The basic premise of this approach is that the effect of a particular policy on gross job flows is greater in industries where the policy is more likely to constrain firm behaviour. We check, however, the robustness of our results using more standard cross-country/time-series estimates. The richness of the data available to us allows estimating the impact of the institutions also on the transitions from job to job, the transitions from job to nonemployment and the transitions from non-employment to jobs. We find that cross-country differences in job protection for open-ended contracts and unemployment benefits can explain a large share of crosscountry variation in gross worker flows. However, the effect of the former is essentially limited to job-tojob flows. Il y a peu de résultats comparatifs à travers les pays sur la manière dont les institutions du marché du travail façonnent les flux bruts d’emplois et de main d’oeuvre, en raison d’un manque de données comparables pour un certain nombre de pays. Cet article comble cet écart, en s’appuyant sur une base de données harmonisées sur les embauches et les cessations d‘emplois au niveau des secteurs d’activité pour un grand nombre de pays de l’OCDE, et en analysant comment un certain nombre d’institutions nationales des marchés du travail et des produits façonnent les écarts de réallocation de main d’oeuvre entre les pays. Afin d’identifier l’effet des politiques et des institutions nationales, nous considérons un modèle de différence en différences au niveau des secteurs d’activité. Le principe de base de cette méthode est que l’effet d’une certaine politique sur le flux brut d’emplois est supérieur dans les industries où cette politique est de nature à imposer une contrainte sur le comportement des entreprises. Nous vérifions, cependant, la robustesse des résultats en utilisant des estimations plus standards en coupe transversale et série temporelle. La richesse des données disponibles permet également l’estimation de l’impact des institutions sur les transitions d’un emploi à l’autre, les transitions d’un emploi au non-emploi et les transitions du nonemploi vers l’emploi. Nous trouvons que les différences inter-pays dans la protection de l’emploi pour les contrats à durée indéterminée et les prestations de chômage peuvent expliquer une large proportion des variations inter-pays des flux bruts de main d’oeuvre. Cependant, l’effet du premier est essentiellement limité aux flux d’un emploi à l’autre.

Suggested Citation

  • Andrea Bassanini & Andrea Garnero & Pascal Marianna & Sébastien Martin, 2010. "Institutional Determinants of Worker Flows: A Cross-Country/Cross-Industry Approach," OECD Social, Employment and Migration Working Papers 107, OECD Publishing.
  • Handle: RePEc:oec:elsaab:107-en
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    File URL: http://dx.doi.org/10.1787/5kmbqvstc09x-en
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    Cited by:

    1. repec:eee:dyncon:v:81:y:2017:i:c:p:187-215 is not listed on IDEAS
    2. John Martin & Stefano Scarpetta, 2012. "Setting It Right: Employment Protection, Labour Reallocation and Productivity," De Economist, Springer, vol. 160(2), pages 89-116, June.
    3. Gabriele Cardullo & Marco Guerrazzi, 2016. "The Cyclical Volatility of Equilibrium Unemployment and Vacancies: Evidence From Italy," LABOUR, CEIS, vol. 30(4), pages 433-454, December.
    4. 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.
    5. Mathijs Gerritsen & Jens Høj, 2013. "The Dutch Labour Market: Preparing for the Future," OECD Economics Department Working Papers 1012, OECD Publishing.
    6. Andrea Bassanini, 2012. "Aggregate Earnings and Macroeconomic Shocks: the Role of Labour Market Policies and Institutions," Review of Economics and Institutions, Università di Perugia, vol. 3(3).
    7. Richard Fabling & David C. Maré, 2012. "Cyclical Labour Market Adjustment in New Zealand: The Response of Firms to the Global Financial Crisis and its Implications for Workers," Working Papers 12_04, Motu Economic and Public Policy Research.
    8. Criscuolo, Chiara & Gal, Peter N. & Menon, Carlo, 2014. "The dynamics of employment growth: new evidence from 18 countries," LSE Research Online Documents on Economics 60286, London School of Economics and Political Science, LSE Library.
    9. José María Casado & Cristina Fernández & Juan F. Jimeno, 2015. "Worker flows in the European Union during the Great Recession," Working Papers 1529, Banco de España;Working Papers Homepage.
    10. Andrew Kerr, 2016. "Job flows, worker flows, and churning in South Africa," WIDER Working Paper Series 037, World Institute for Development Economic Research (UNU-WIDER).
    11. Peter Gal & Alexander Hijzen & Zoltan Wolf, 2012. "The Role of Institutions and Firm Heterogeneity for Labour Market Adjustment: Cross-Country Firm-Level Evidence," OECD Social, Employment and Migration Working Papers 134, OECD Publishing.
    12. Clovis Kerdrain & Isabell Koske & Isabelle Wanner, 2010. "The Impact of Structural Policies on Saving, Investment and Current Accounts," OECD Economics Department Working Papers 815, OECD Publishing.
    13. Holzmann, Robert & Pouget, Yann & Vodopivec, Milan & Weber, Michael, 2011. "Severance pay programs around the world : history, rationale, status, and reforms," Social Protection and Labor Policy and Technical Notes 62726, The World Bank.
    14. Jimeno, Juan F. & Thomas, Carlos, 2013. "Collective bargaining, firm heterogeneity and unemployment," European Economic Review, Elsevier, vol. 59(C), pages 63-79.
    15. Paula Garda & Volker Ziemann, 2014. "Economic Policies and Microeconomic Stability: A Literature Review and Some Empirics," OECD Economics Department Working Papers 1115, OECD Publishing.
    16. Vodopivec, Matija & Laporsek, Suzana & Vodopivec, Milan, 2016. "Levelling the Playing Field: The Effects of Slovenia's 2013 Labour Market Reform," IZA Discussion Papers 9783, Institute for the Study of Labor (IZA).
    17. Clovis Kerdrain & Isabell Koske & Isabelle Wanner, 2011. "Current Account Imbalances: can Structural Reforms Help to Reduce Them?," OECD Journal: Economic Studies, OECD Publishing, vol. 2011(1), pages 1-44.
    18. Aida Caldera Sánchez & Dan Andrews, 2011. "To Move or not to Move: What Drives Residential Mobility Rates in the OECD?," OECD Economics Department Working Papers 846, OECD Publishing.
    19. Isabell Koske & Jean-Marc Fournier & Isabelle Wanner, 2012. "Less Income Inequality and More Growth – Are They Compatible? Part 2. The Distribution of Labour Income," OECD Economics Department Working Papers 925, OECD Publishing.
    20. Boris Cournède & Paula Garda & Volker Ziemann, 2015. "Effects of Economic Policies on Microeconomic Stability," OECD Economics Department Working Papers 1201, OECD Publishing.

    More about this item

    Keywords

    cross-country data; job-to-job transitions; labour market institutions; worker flows;

    JEL classification:

    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J63 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Turnover; Vacancies; Layoffs

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