The Impact of Institutions on the Employment Performance in European Labour Markets
This paper investigates the role of the institutional framework for the labor market performance in EU countries. The point of departure is the labor demand equation derived from cost minimization behaviour of firms. Labor demand is expressed by its structural parameters, i.e. the output and real wa...
| Authors: | , , , |
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| Format: | article |
| Status: | Published version |
| Publication Date: | 2009 |
| Country: | España |
| Institution: | Varias* (Consorci de Biblioteques Universitáries de Catalunya, Centre de Serveis Científics i Acadèmics de Catalunya) |
| Repository: | Recercat. Dipósit de la Recerca de Catalunya |
| OAI Identifier: | oai:recercat.cat:2445/67464 |
| Online Access: | https://hdl.handle.net/2445/67464 |
| Access Level: | Open access |
| Keyword: | Mercat de treball Institucions financeres Oferta i demanda Macroeconomia Labor market Financial institutions Supply and demand Macroeconomics |
| Summary: | This paper investigates the role of the institutional framework for the labor market performance in EU countries. The point of departure is the labor demand equation derived from cost minimization behaviour of firms. Labor demand is expressed by its structural parameters, i.e. the output and real wage elasticity. Cointegration relation-ships between employment, output and wages are revealed by efficient estimation techniques. The long run parameters may vary due to structural change. They are explained by indicators for product and labor market institutions using panel fixed effects models. The results suggest that higher flexibility in the product and labor markets are appropriate strategies to improve the labor market record. The response of employment to macroeconomic conditions is stronger in a more deregulated environment, and the absorption of shocks can be relieved. |
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