Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/2596
Authors: 
Fehn, Rainer
Meier, Carsten-Patrick
Year of Publication: 
2001
Series/Report no.: 
CESifo Working Paper 456
Abstract: 
This paper presents a positive model which shows that institutional setups on capital and labor markets might be intertwined by politicoeconomic forces. Some countries especially in continental Europe exhibit a corporatist politicoeconomic equilibrium with a sustantial protection of insiders on both markets. The more important money is in political decision-making, the more devided the workface is, and the more globalized capital markets are, the more likely is a capitalist politicoeconomic equilibrium with little employment and substantial investor protection. Our prediction of a negative cross-country relationship between labor market rigidities and of competition on capital markets receives considerable empicical support.
Subjects: 
labor markets
employment protection
corporatism
corporate governance
shareholder protection
political economy
JEL: 
G34
K22
K42
Document Type: 
Working Paper

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