Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/246169 
Year of Publication: 
2021
Series/Report no.: 
ECB Working Paper No. 2592
Publisher: 
European Central Bank (ECB), Frankfurt a. M.
Abstract: 
Using new quarterly narrative evidence, this paper examines the macroeconomic impact of reforms of unemployment benefits (UB) and employment protection legislation (EPL) in the euro area from a Bayesian narrative panel VAR. The approach complements existing micro-econometric evidence by aligning short- and mediumterm effects in a unified framework and assessing state dependencies. Liberalising reforms result in temporary wage declines and highly persistent increases in economic activity and employment. In contrast to UB reforms, the effects of EPL reforms on employment emerge only gradually.
Subjects: 
Employment Protection Legislation
Unemployment Benefits
Narrative Identification
Discriminant Regression
JEL: 
E32
J08
O43
Persistent Identifier of the first edition: 
ISBN: 
978-92-899-4815-9
Document Type: 
Working Paper

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