Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/111412
Authors: 
Fries, Claudia
Year of Publication: 
2015
Series/Report no.: 
ZEW Discussion Papers 15-040
Abstract: 
I extend the model-based literature on spillover effects of labour market reforms on foreign (un-)employment by allowing for third-country effects. When the workhorse two-country model is enlarged to include a third country, a reform causes an additional indirect effect through a terms-of-trade shift between the foreign countries. To quantify the increase or reduction in the overall spillover by means of this channel, simulations based on empirically realistic scenarios are carried out. Thereby, the indirect effect turns out to be too small to overturn the direct effect or to increase it considerably. Differences in the reform spillover effects between foreign countries are mainly due to differences in characteristics which influence the size of the direct impact.
Subjects: 
spillover
labour market reforms
third-country effects
indirect effects
dynamic general equilibrium models
JEL: 
E24
F42
Document Type: 
Working Paper

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