Labour Market Institutions and the Employment Intensity of Output Growth. An International Comparison

22 Pages Posted: 29 Nov 2007

See all articles by Gebhard Flaig

Gebhard Flaig

Ludwig Maximilian University of Munich (LMU) - Faculty of Economics

Horst Rottmann

University of Applied Sciences Amberg-Weiden; CESifo (Center for Economic Studies and Ifo Institute)

Date Written: December 2007

Abstract

This paper deals with the effects of labour market institutions on labour market performance. We analyse as an indicator for the labour intensity of output growth the employment threshold (the minimum growth rate of output necessary to keep employment constant). We show for a sample of 17 OECD countries for the period 1971 to 2002 that the strictness of employment protection raises the employment threshold in all econometric specifications. A higher wage bargaining coordination and a higher tax wedge reduce also the labour intensity of production, although the effects are not significant in all econometric specifications.

Keywords: employment protection, labour market institutions, labour demand, international comparison, employment threshold

JEL Classification: J23, E24, J50

Suggested Citation

Flaig, Gebhard and Rottmann, Horst, Labour Market Institutions and the Employment Intensity of Output Growth. An International Comparison (December 2007). FEEM Working Paper No. 101.2007, CESifo Working Paper Series No. 2175, Available at SSRN: https://ssrn.com/abstract=1032847 or http://dx.doi.org/10.2139/ssrn.1032847

Gebhard Flaig (Contact Author)

Ludwig Maximilian University of Munich (LMU) - Faculty of Economics ( email )

Ludwigstrasse 28
Munich, D-80539
Germany

Horst Rottmann

University of Applied Sciences Amberg-Weiden ( email )

Hetzenrichter Weg 15
D-92637 Weiden i.d. Opf
Germany

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

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