The Interaction of Labor Market Regulation and Labor Market Policies in Welfare State Reform
42 Pages Posted: 29 Jun 2007
There are 2 versions of this paper
The Interaction of Labor Market Regulation and Labor Market Policies in Welfare State Reform
Abstract
Employment protection legislation, unemployment benefits, and active labor market policy are Janus-faced institutions. On the one hand they are devices of insurance against labor market risk that provide income and employment security. On the other hand they influence the capacities of labor markets to adapt to changing economic conditions since institutional features of the welfare state also affect actors' economic adaptation strategies. Insufficient labor market adaptability results in higher and more persistent unemployment. Hence, in order to increase the adaptability of European labor markets, reforms had to address these closely interacting policy areas. The first aim of the paper is to describe recent reforms of employment protection, unemployment insurance, and active labor market policies in different European welfare states (Denmark, Sweden, the United Kingdom, Switzerland, the Netherlands, Spain, and Germany). The paper shows whether and to what extent national policy patterns converge in the direction of a new balance of flexibility and security with employment protection being eased and labor market policies being "activated" through a combination of "carrots and sticks." Secondly, in terms of the political economy of welfare state reforms, the paper will answer the question whether consistent reforms of the three institutions are more likely in political systems characterized by relative strong government and/or social partnership since such institutional prerequisites may favor "package deals" across policy areas.
Suggested Citation: Suggested Citation
Do you have negative results from your research you’d like to share?
Recommended Papers
-
The Effects of Emu on Structural Reforms in Labour and Product Markets
By Romain Duval and Jörgen Elmeskov
-
Why are European Countries Diverging in Their Unemployment Experience?
-
Why are European Countries Diverging in Their Unemployment Experience?
-
The Intriguing Nexus between Corruption and Capital Account Restrictions
By Axel Dreher and Lars H.r. Siemers
-
Awareness of General Equilibrium Effects and Unemployment
By Hans Gersbach and Achim Schniewind
-
Awareness of General Equilibrium Effects and Unemployment
By Hans Gersbach and Achim Schniewind
-
Learning of General Equilibrium Effects and the Unemployment Trap
By Hans Gersbach and Achim Schniewind
-
Structural Reforms and the Macroeconomy: The Role of General Equilibrium Effects