Labour Market Institutions and Labour Market Performance
University of Bologna - Faculty of Economics; Institute for the Study of Labor (IZA)
Institute for the Study of Labor (IZA); Saint Petersburg State University - Graduate School of Management
Economics of Transition, Vol. 20, Issue 2, pp. 235-269, 2012
This paper studies the relationship between labour market institutions and policies and labour market performance using a new and unique dataset that covers the countries of Eastern Europe and Central Asia, which in the last two decades experienced radical economic and institutional transformations. We document a clear trend towards liberalization of labour markets, especially in the countries of the former Soviet Union, but also substantial differences across the countries studied. Our econometric analysis implies that institutions matter for labour market outcomes, and that deregulation of labour markets improves their performance. The analysis also suggests several significant interactions between different institutions, which are in line with the idea of beneficial effects of reform complementarity and broad reform packages.
Number of Pages in PDF File: 35
Keywords: Labour market institutions, unemployment, transition economies
JEL Classification: E24, J21, P20Accepted Paper Series
Date posted: March 20, 2012
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