Labor Market Reforms and Unemployment Dynamics

Abstract: We quantify the contribution of labor market reforms to unemployment dynamics in nine OECD countries (Australia, France, Germany, Japan, Portugal, Spain, Sweden, UK, US). We estimate a dynamic stochastic search-matching model with heterogeneous workers and aggregate productivity shocks. The heterogeneous-worker mechanism proposed by Robin (2011) explains unemployment volatility by productivity shocks well in all countries. Placement and employment services, UI benefit reduction and product market deregulation are found to be the most prominent policy levers for unemployment reduction. Business cycle shocks and LMPs explain about the same share of unemployment volatility (except for Japan, Portugal and the US).

Keywords: Unemployment dynamics; Turnover; Labor market institutions; Job search; Matching function (search for similar items in EconPapers)
Date: 2018
Note: View the original document on HAL open archive server: https://sciencespo.hal.science/hal-03602693
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Published in Labour Economics, 2018, 50, pp.3 - 19. ⟨10.1016/j.labeco.2016.05.025⟩

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Related works:
Journal Article: Labor market reforms and unemployment dynamics (2018)
Working Paper: Labor Market Reforms and Unemployment Dynamics (2018)
Working Paper: Labor market reforms and unemployment dynamics (2014)
Working Paper: Labor market reforms and unemployment dynamics (2014)
Working Paper: Labor market reforms and unemployment dynamics (2014)
Working Paper: Labor market reforms and unemployment dynamics (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:hal:spmain:hal-03602693

DOI: 10.1016/j.labeco.2016.05.025

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