Family Values and the Regulation of Labor

74 Pages Posted: 22 Feb 2010 Last revised: 13 Jul 2010

See all articles by Alberto F. Alesina

Alberto F. Alesina

Harvard University - Department of Economics; Centre for Economic Policy Research (CEPR); National Bureau of Economic Research (NBER)

Yann Algan

Universite Paris I Pantheon-Sorbonne - CNRS-EUREQUA; IZA Institute of Labor Economics

Pierre Cahuc

National Institute of Statistics and Economic Studies (INSEE) - National School for Statistical and Economic Administration (ENSAE); Université Paris I Panthéon-Sorbonne - Equipe Universitaire de Recherche en Economie Quantitative (EUREQUA); University of Angers - French National Center for Scientific Research (CNRS); Centre for Economic Policy Research (CEPR); IZA Institute of Labor Economics

Paola Giuliano

University of California, Los Angeles (UCLA) - Anderson School of Management; National Bureau of Economic Research (NBER); Centre for Economic Policy Research (CEPR); IZA Institute of Labor Economics

Multiple version iconThere are 4 versions of this paper

Date Written: February 2010

Abstract

Flexible labor markets require geographically mobile workers to be efficient. Otherwise firms can take advantage of the immobility of workers and extract rents at the expense of workers. In cultures with strong family ties, moving away from home is costly. Thus, to limit the rents of firms and avoid moving, individuals with strong family ties rationally choose regulated labor markets, even though regulation generates lower employment and income. Empirically, we do find that individuals who inherit stronger family ties are less mobile, have lower wages, are less often employed and support more stringent labor market regulations. We find a positive association between labor market rigidities at the beginning of the twenty first century and family values prevailing before World War II, and between family structures in the Middle Ages and current desire for labor market regulation. Both results suggest that labor market regulations have deep cultural roots.

Suggested Citation

Alesina, Alberto F. and Algan, Yann and Cahuc, Pierre and Giuliano, Paola, Family Values and the Regulation of Labor (February 2010). NBER Working Paper No. w15747. Available at SSRN: https://ssrn.com/abstract=1556112

Alberto F. Alesina (Contact Author)

Harvard University - Department of Economics ( email )

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Centre for Economic Policy Research (CEPR)

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National Bureau of Economic Research (NBER)

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Yann Algan

Universite Paris I Pantheon-Sorbonne - CNRS-EUREQUA ( email )

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IZA Institute of Labor Economics

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Germany

Pierre Cahuc

National Institute of Statistics and Economic Studies (INSEE) - National School for Statistical and Economic Administration (ENSAE) ( email )

92245 Malakoff Cedex
France

Université Paris I Panthéon-Sorbonne - Equipe Universitaire de Recherche en Economie Quantitative (EUREQUA) ( email )

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Paris Cedex 13, 75647
France
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HOME PAGE: http://eurequa.univ-paris1.fr/membres/cahuc/

University of Angers - French National Center for Scientific Research (CNRS)

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75647 Paris Cedex 13
France
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Centre for Economic Policy Research (CEPR)

London
United Kingdom

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Paola Giuliano

University of California, Los Angeles (UCLA) - Anderson School of Management ( email )

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Los Angeles, CA 90095-1481
United States

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Centre for Economic Policy Research (CEPR) ( email )

London
United Kingdom

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

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