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The Economic Significance of Laws Relating to Employment Protection & Different Forms of Employment: Analysis of a Panel of 117 Countries, 1990-2013

Author

Listed:
  • Zoe Adams
  • Louise Bishop
  • Simon Deakin
  • Colin Fenwick
  • Sara Martinsson Garzelli
  • Giudy Rusconi
  • Centre for Business Research
Abstract
This paper presents findings from analysis of a dataset of labour laws, based on the Centre for Business Research Labour Regulation Index (CBR-LRI), which has recently been extended to cover 117 countries and the period from 1970 to 2013. The dataset shows that laws regulating different forms of employment (DFE), including part-time work, fixed-term employment and agency work, have become significantly more protective over time, in particular since the late 1990s. Employment protection laws (EPL), covering individual dismissal, collective consultation and codetermination rights, have become steadily more protective since the 1970s. Europe has seen a decline in the level of EPL since the onset of the sovereign debt crisis in 2008, but this trend is small, on average, by comparison to earlier increases in protection beginning in the 1970s, and has not been replicated in other regions. Time-series econometric analysis using non-stationary panel data methods suggests that strengthening worker protection in relation to DFE and EPL is associated with an increase in labour's share of national income, rising labour force participation, rising employment, and falling unemployment, although the observed magnitudes are small when set against wider economic trends.

Suggested Citation

  • Zoe Adams & Louise Bishop & Simon Deakin & Colin Fenwick & Sara Martinsson Garzelli & Giudy Rusconi & Centre for Business Research, 2018. "The Economic Significance of Laws Relating to Employment Protection & Different Forms of Employment: Analysis of a Panel of 117 Countries, 1990-2013," Working Papers wp500, Centre for Business Research, University of Cambridge.
    • Handle: RePEc:cbr:cbrwps:wp500
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    References listed on IDEAS

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    4. Aditya Bhattacharjea, 2019. "Labour Market Flexibility in Indian Industry A Critical Survey of the Literature," Working papers 296, Centre for Development Economics, Delhi School of Economics.

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    More about this item

    Keywords

    labour regulation; employment protection; labour flexibility; employment; unemployment; productivity; labour share; leximetrics; time series analysis; pooled mean group regression;
    All these keywords.

    JEL classification:

    • C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes
    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • K31 - Law and Economics - - Other Substantive Areas of Law - - - Labor Law
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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