Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/181513
Authors: 
Weber, Enzo
Gehrke, Britta
Year of Publication: 
2018
Series/Report no.: 
Beiträge zur Jahrestagung des Vereins für Socialpolitik 2018: Digitale Wirtschaft - Session: Labor and Unemployment III C21-V3
Abstract: 
This paper proposes a novel approach to identify structural long-term driving forces of the labor market and their state dependent effects. Based on search and matching theory, our empirical model extracts these driving forces within an unobserved components approach. We relate changes in the labor market structures to reforms that enhance the flexibility of the labor market in expansion and recession. Results for Germany and Spain show that labor market reforms have substantially weaker beneficial effects in the short-run when implemented in recessions. From a policy perspective, these results highlight the costs of introducing reforms in recessions.
Subjects: 
labor market reforms
search and matching
business cycle asymmetries
Markov switching
JEL: 
C32
E02
E32
J08
Document Type: 
Conference Paper
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