Does Labour Law Hurt Labour by Reducing Employment in Developed and Emerging Countries?

34 Pages Posted: 8 Jun 2015 Last revised: 30 Mar 2017

See all articles by Simon Deakin

Simon Deakin

University of Cambridge - Centre for Business Research (CBR); European Corporate Governance Institute (ECGI); University of Cambridge - Faculty of Law

Prabirjit Sarkar

University of Cambridge - Centre for Business Research (CBR)

Date Written: November 7, 2016

Abstract

Using longitudinal data on labour law for 108 countries over the period 1996-2013, the present study estimates the impact of labour regulation on total and youth employment. Using the dynamic panel data analysis it is observed that worker-protective labour laws including the dismissal law do not hamper the long-term employment prospects of the general work force and the youth population. Rather it provides a better legal environment for increasing employment opportunities. By and large this result holds in the two sub-samples: one consisting of 23 developed countries and the other consisting of 85 less-developed countries (including 26 ex-socialist countries).

Keywords: labour law, unemployment rate, long-term unemployment, youth unemployment

JEL Classification: K31, J08, J50, J60, J83

Suggested Citation

Deakin, Simon F. and Sarkar, Prabirjit, Does Labour Law Hurt Labour by Reducing Employment in Developed and Emerging Countries? (November 7, 2016). Available at SSRN: https://ssrn.com/abstract=2615691 or http://dx.doi.org/10.2139/ssrn.2615691

Simon F. Deakin

University of Cambridge - Centre for Business Research (CBR) ( email )

Top Floor, Judge Business School Building
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+ 44 1223 335243 (Phone)

European Corporate Governance Institute (ECGI)

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Belgium

HOME PAGE: http://www.ecgi.org

University of Cambridge - Faculty of Law ( email )

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Cambridge, CB3 9DZ
United Kingdom

Prabirjit Sarkar (Contact Author)

University of Cambridge - Centre for Business Research (CBR) ( email )

Cambridge
United Kingdom

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