Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/20987
Authors: 
Belot, Michèle
van Ours, Jan C.
Year of Publication: 
2000
Series/Report no.: 
IZA Discussion paper series 147
Abstract: 
The development of the unemployment rate differs substantially between OECD countries. In recent years some countries experienced a mild increase, other countries had a stable unemployment rate, while there are also 'successful' countries in which the unemployment rate decreased a lot. A common feature of the successful countries is that they implemented a comprehensive set of institutional reforms. In this paper we present a theoretical and empirical framework to investigate how unemployment is affected by different labour market institutions (LMI) such as labour taxes, unemployment benefits, employment protection, union bargaining power and (de)centralisation of bargaining. We argue that complementarities between LMI can be exploited to improve labour market performance. In our empirical analysis of annual data over the period 1960-1995 of eighteen OECD countries we show that interactions between LMI are indeed important.
Subjects: 
OECD
unemployment
institutions
complementarities
reforms
JEL: 
J68
E24
Document Type: 
Working Paper

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