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Youth unemployment in the OECD: The role of institutions

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  • Sachs, Andreas
  • Smolny, Werner

Abstract

This paper analyzes the role of labor market institutions for youth unemployment, as contrasted to total unemployment. The empirical results are basically consistent with an insider view of labor market institutions. Labor market institutions tend to protect (older) employees but might harm (young) entrants. Remarkable is especially the significant and very high effect of employment protection for regular jobs on youth unemployment. In addition, the combined effects of powerful unions and a coordinated wage bargaining system are beneficial for older people and detrimental to youth. Finally, the paper establishes significant labor supply effects and effects of the education system on youth and total unemployment.

Suggested Citation

  • Sachs, Andreas & Smolny, Werner, 2014. "Youth unemployment in the OECD: The role of institutions," ZEW Discussion Papers 14-080, ZEW - Leibniz Centre for European Economic Research.
    • Handle: RePEc:zbw:zewdip:14080
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    1. Youth unemployment in the OECD: The role of institutions
      by maximorossi in NEP-LTV blog on 2014-12-19 16:58:12

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    Cited by:

    1. Joachim Möller & Gerhard Bosch & Günther Schmid & Jörg Schmidt & Jörg Asmussen, 2015. "Youth Unemployment in Europe: a Generation With No Prospects?," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 68(17), pages 03-21, September.
    2. Carsten Ochsen, 2021. "Age cohort effects on unemployment in the USA: Evidence from the regional level," Papers in Regional Science, Wiley Blackwell, vol. 100(4), pages 1025-1053, August.
    3. Süheyla Erikli & Serap Pelin Türkoğlu, 2021. "OECD Ülkelerinin İşgücü Piyasası Performans Analizi," Journal of Social Policy Conferences, Istanbul University, Faculty of Economics, vol. 0(80), pages 299-320, June.
    4. Damir STIJEPIC, 2020. "Employment effects of skills around the world: Evidence from the PIAAC," International Labour Review, International Labour Organization, vol. 159(3), pages 307-338, September.
    5. Fitzenberger Bernd & Gürtzgen Nicole & Pfeiffer Friedhelm, 2015. "Guest Editorial," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 235(4-5), pages 352-354, August.

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    More about this item

    Keywords

    Youth unemployment; labor market institutions; age-specific unemployment;
    All these keywords.

    JEL classification:

    • E02 - Macroeconomics and Monetary Economics - - General - - - Institutions and the Macroeconomy
    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J68 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Public Policy

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