Labor Policy and Digital Technology Use: Indicative Evidence from Cross-Country Correlations

31 Pages Posted: 19 Oct 2017

See all articles by Truman G. Packard

Truman G. Packard

World Bank - Europe and Central Asia Region; University of Oxford - Department of Economics

Claudio E. Montenegro

World Bank Group; Universidad de Chile, Economics Department

Date Written: October 18, 2017

Abstract

This paper exploits variation in country-level indicators drawn from published data to analyze the relationship between labor regulation and the use of digital technology. The analysis shows a statistically and economically significant association between digital technology use by firms and a country's statutory minimum wage and employment protection regulations. The results are robust to the inclusion of controls for level of development, economic stability, available infrastructure, and trade openness. To ensure the broadest country coverage, the paper develops new indexes of employment protection, using the World Bank's Doing Business indicators, which allow several aspects of labor market regulation?such as restrictions on hours and hiring, dismissal procedures, and severance costs--to be analyzed separately.

Keywords: Social Protections & Assistance

Suggested Citation

Packard, Truman G. and Montenegro, Claudio E., Labor Policy and Digital Technology Use: Indicative Evidence from Cross-Country Correlations (October 18, 2017). World Bank Policy Research Working Paper No. 8221, Available at SSRN: https://ssrn.com/abstract=3055466

Truman G. Packard (Contact Author)

World Bank - Europe and Central Asia Region ( email )

1818 H Street
Washington, DC 20433
United States

University of Oxford - Department of Economics ( email )

Manor Road Building
Manor Road
Oxford, OX1 3BJ
United Kingdom

Claudio E. Montenegro

World Bank Group ( email )

1818 H. Street, N.W.
MSN3-311
Washington, DC 20433
United States

Universidad de Chile, Economics Department

Diagonal Paraguay 257
Torre 26, Of. 1801
Santiago
Chile

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