Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/125663
Authors: 
Busl, Claudia
Seymen, Atilim
Year of Publication: 
2013
Series/Report no.: 
WWWforEurope Working Paper 8
Abstract: 
In this paper we analyze the (potential) effects of labour market and fiscal policy reforms by heterogeneous European countries—Germany and France—on the domestic and foreign economy. We test the implications of the gains in matching efficiency and reduced unemployment benefits induced by the German Hartz reforms in a two-country RBC model with frictions in the labour market, which replicates the data quite well. We then explore the reform possibilities in the French labour market and their potential (inter)national effects by calibrating the model to recent data. Both home and foreign economies benefit from labour market reforms in the home economy in our framework.
Subjects: 
Labour market reforms
search and matching
dynamic stochastic general equilibrium models
JEL: 
E24
E61
E65
F42
J38
J63
Document Type: 
Working Paper
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