Euro-Productivity and Euro-Jobs Since the 1960s: Which Institutions Really Mattered?

58 Pages Posted: 29 Sep 2006 Last revised: 15 Sep 2010

See all articles by Gayle J. Allard

Gayle J. Allard

Instituto de Empresa Business School

Peter H. Lindert

University of California, Davis - Department of Economics; National Bureau of Economic Research (NBER)

Date Written: August 2006

Abstract

How have labor market institutions and welfare-state transfers affected jobs and productivity in Western Europe, relative to industrialized Pacific Rim countries? Orthodox criticisms of European government institutions are right in some cases and wrong in others. Protectionist labor-market policies such as employee protection laws seem to have become more costly since about 1980, not through overall employment effects, but through the net human-capital cost of protecting senior male workers at the expense of women and youth. Product-market regulations in core sectors may also have reduced GDP, though here the evidence is less robust. By contrast, high general tax levels have shed the negative influence they might have had in the 1960s and 1970s. Similarly, other institutions closer to the core of the welfare state have caused no net harm to European jobs and growth. The welfare state%u2019s tax-based social transfers and coordinated wage bargaining have not harmed either employment or GDP. Even unemployment benefits do not have robustly negative effects.

Suggested Citation

Allard, Gayle J. and Lindert, Peter H., Euro-Productivity and Euro-Jobs Since the 1960s: Which Institutions Really Mattered? (August 2006). NBER Working Paper No. w12460, Available at SSRN: https://ssrn.com/abstract=924746

Gayle J. Allard

Instituto de Empresa Business School ( email )

Serrano 99
Madrid, 28006
Spain

Peter H. Lindert (Contact Author)

University of California, Davis - Department of Economics ( email )

One Shields Ave
Davis, CA 95616
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Here is the Coronavirus
related research on SSRN

Paper statistics

Downloads
35
Abstract Views
547
PlumX Metrics