Sarkar, Prabirjit (2011): Does employment protection lead to unemployment? A panel data analysis of OECD countries, 1990-2008.
Download (165Kb) | Preview
This paper analysed the OECD data on employment protection for 23 OECD countries over the time span 1990-2008 on the basis of alternative dynamic panel data models and panel causality tests and examines the validity of the neo-liberal argument that strictness of employment protection hurts labour through increased long-term and youth unemployment rates. While it finds no empirical basis for this orthodox standpoint it observes that long-term unemployment dampens aggregate production which in turn aggravates unemployment problem.
|Item Type:||MPRA Paper|
|Original Title:||Does employment protection lead to unemployment? A panel data analysis of OECD countries, 1990-2008|
|Keywords:||labour law; regular job protection; temporary job protection, unemployment rate; long-term unemployment; youth unemployment|
|Subjects:||J - Labor and Demographic Economics > J0 - General > J08 - Labor Economics Policies
J - Labor and Demographic Economics > J6 - Mobility, Unemployment, and Vacancies > J60 - General
K - Law and Economics > K3 - Other Substantive Areas of Law > K31 - Labor Law
J - Labor and Demographic Economics > J5 - Labor-Management Relations, Trade Unions, and Collective Bargaining > J50 - General
|Depositing User:||Dr P SARKAR|
|Date Deposited:||23. Dec 2011 15:50|
|Last Modified:||12. Feb 2013 12:26|
Baker, D., Glyn, A., Howell, D. and Schmitt, J. “Unemployment and Labour Market Institutions: The Failure of the Empirical Case for Deregulation, ILO Working Paper No. 43 (2004)
Beck, T., A. Demirgüc-Kunt and R. Levine, “Law and finance: why does legal origin matter?” Journal of Comparative Economics 31(2003a): 653-675.
Beck, T., A. Demirgüc-Kunt and R. Levine, “Law, endowments and finance,” Journal of Financial Economics 70(2003b): 137-181.
Besley, T. and R. Burgess, “Can labour regulation hinder economic performance? Evidence from India,” Quarterly Journal of Economics 199(2004): 91-134.
Bhaduri, Amit, and Stephen A. Marglin. "Real Wages and Unemployment: The Economic Basis for Contesting Political Ideologies," Cambridge Journal of Economics 14 (1990): 375-93.
Bhattacharjea A. “Labour Market Regulation and Industrial Performance in India: A Critical Review of the Empirical Evidence,” CDE Working Paper No.141, Delhi School of Economics, also in Indian Journal of Labour Economics 39(2006).
Blackburne III, F. Edward and M. W. Frank, “Estimation of non-stationary heterogeneous panels,” The Stata Journal 7(2007): 197-208.
Botero J., S. Djankov, R. La Porta, F. Lopez-de-Silanes and A.Shleifer, “The regulation of labour,” Quarterly Journal of Economics 119(2004): 1339-1382.
Deakin, S., P. Lele and M. Siems,”The evolution of labour law: Calibrating and comparing regulatory regimes,” International Labour Review 146 (2007): 146: 133-62.
Deakin, S. and P. Sarkar, “Assessing the long-run economic impact of labour law systems: a theoretical reappraisal and analysis of new time series data,” Industrial Relations Journal (2008) 39: 453-87.
Deakin, S. and P. Sarkar, “Indian Labour Law and its Impact on Unemployment, 1970-2006: A Leximetric Study,” Centre for Business Research (University of Cambridge, UK) Working Paper, December 2011 (Available at SSRN: http://ssrn.com/abstract=1913609).
Dutt, Amitava K. "Stagnation, Income Distribution and 'Monopoly Power'," Cambridge Journal of Economics 8 (1984): 25- 40.
Djankov, S., E. Glaeser, R. La Porta, F. Lopez-de-Silanes and A.Shleifer, “The new comparative economics,” Journal of Comparative Economics 31(2003): 595-619.
Djankov, S., R.La Porta, F. Lopez-de-Silanes and A.Shleifer “The law and economics of self-dealing,” Journal of Financial Economics 88(2008): 430–65.
Fallon, P. and R. Lucas, ‘The impact of changes in job security legislation in India and Zimbabwe,” World Bank Economic Review 5(1993): 395-413.
Freeman, Richard, B., “Labour Market Institutions and Policies: Help or Hindrance to Economic Development?” Proceedings of the World Bank annual conference on development economics 1992 (published as World Bank Economic Review and World Bank Research Observer Supplement, 1993).
Freeman, Richard, B., “Labour market institutions without blinders: the debate over flexibility and labour market performance,” International Economic Journal 19 (2005): 129-145.
Heckman, J. and C. Pagés, “Introduction to law and employment: lessons from Latin America and the Caribbean,” in J. Heckman and C. Pagés (eds.) Law and Employment: Lessons from Latin America and the Caribbean (Chicago: NBER and University of Chicago Press, 2004).
Glaeser E. and A.Shleifer, “Legal origins,” Quarterly Journal of Economics 117(2002): 1193-1229.
Glaeser E. and A.Shleifer, “The rise of the regulatory state,” Journal of Economic Literature 41(2003): 401-425.
IMF “Unemployment and labour market institutions: why reforms pay off’, in IMF (ed.) World Economic Outlook, Chapter 4 (Washington, DC: International Monetary Fund, 2003).
La Porta R., F. Lopez-de-Silanes, A. Shleifer and R. Vishny, “Legal determinants of external finance,” Journal of Finance 52(1997): 1131-1150.
La Porta R., F. Lopez-de-Silanes, A.Shleifer and R. Vishny, “Law and finance,” Journal of Political Economy 106 (1998): 1113-55.
La Porta R., F. Lopez-de-Silanes and A.Shleifer, “Corporate ownership around the world,” Journal of Finance 54(1999): 471-517.
La Porta R., F. Lopez-de-Silanes, A.Shleifer and R. Vishny, “Agency problems and dividend policies around the world,” Journal of Finance 55(2000): 1-33.
La Porta R., F. Lopez-de-Silanes, and A.Shleifer, “What works in securities laws?” Journal of Finance 61(2006): 1-32.
La Porta, R., F. Lopez-de-Silanes and A. Shleifer, “The economic consequences of legal origins,” Journal Economic Literature 46(2008): 285–332.
OECD, OECD Jobs Study, Evidence and Explanations, Part I: Labour Market Trends and Underlying Forces of Change (Paris: Organization for Economic Cooperation and Development, 1994).
OECD, Employment Outlook (Paris: Organization for Economic Cooperation and Development, 2004).
Pesaran, M. H., Y. Shin, and R. P. Smith, “Pooled mean group estimation of dynamic heterogeneous panels,” Journal of the American Statistical Association 94(1995): 621-634.
Pesaran, M. H. and R. P. Smith, “Estimating long-run relationships from dynamic heterogeneous panels,” Journal of Econometrics 68(1995): 79-113.
Rogers, J, and W. Streeck, Works Councils: Consultation, Representation and Cooperation in Industrial Relations (Chicago: University of Chicago Press,1995).
Sarkar, Prabirjit, "Industrial Growth and Income Inequality: An Examination of 'Stagnationism' with Special Reference to India," Journal of Quantitative Economics 8 (1992): 125-38.
Sarkar, Prabirjit, "Distribution and Growth: A Critical Note on 'Stagnationism'," Review of Radical Political Economics 25 (1993): 62-70.
Sengenberger, W. and D. Campbell, Creating Opportunities: Role of Labour Standards in Industrial Restructuring (International Institute of Labour Studies, Geneva, 1994).
Steindl, Josef, Maturity and Stagnation in American Capitalism (Oxford: Basil Blackwell, 1952).
Steindl, Josef, "Stagnation Theory and Stagnation Policy," Cambridge Journal of Economics 3 (March 1979): 1-14. Taylor, Lance, Structuralist Macroeconomics (New York: Basic Books, 1983).
Taylor, Lance, Income Distribution, Inflation and Growth (Cambridge, Mass.: MIT Press, 1991).
Venn, Danielle, “Legislation, collective bargaining and enforcement: Updating the OECD employment protection indicators,” OECD Social, Employment and Migration Working Paper (2009) - available online: www.oecd.org/els/workingpapers.
World Bank, Doing Business 2008: Comparing Regulation in 178 Economies (Washington, DC: International Bank for Reconstruction and Development, 2008).