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How do labour laws affect unemployment and the labour share of national income? The experience of six OECD countries, 1970–2010
Author(s) -
DEAKIN Simon,
MALMBERG Jonas,
SARKAR Prabirjit
Publication year - 2014
Publication title -
international labour review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.433
H-Index - 46
eISSN - 1564-913X
pISSN - 0020-7780
DOI - 10.1111/j.1564-913x.2014.00195.x
Subject(s) - unemployment , economics , labour economics , panel data , affect (linguistics) , labour law , distribution (mathematics) , working time , longitudinal data , demographic economics , work (physics) , economic growth , sociology , econometrics , mechanical engineering , mathematical analysis , demography , mathematics , communication , engineering
Using longitudinal data on labour law in France, Germany, Japan, Sweden, the United Kingdom and the United States over the period 1970–2010, the authors estimate the impact of labour regulation on unemployment and the labour share of national income. Their dynamic panel data analysis distinguishes between the short‐run and long‐run effects of regulatory change. They find that worker‐protective labour laws in general have no consistent relationship to unemployment but are positively correlated with labour's share of national income. Laws specifically relating to working time and employee representation are found to have beneficial effects on both efficiency and distribution thus proxied.