Labour Market Institutions in the Western Balkan Countries and their Economic Implications: Evidence for Kosova

Abstract

Flexicurity as one of the most important priorities of employment policies in the EU and its Member States is considered to be also important for the other states of Central and Eastern Europe, including the Western Balkans. According to European Commission (2007, p.7), flexicurity as a combination of flexibility and security in working arrangements can be suggested as an answer to dynamic changes happening in today’s national and international economies; it is an answer to the EU’s dilemma on how to maintain and improve competiveness while reinforcing the European social model.The countries of the Western Balkan which have suffered from the transition process still cannot have a desirable performance of the labour market. Even though the economies of Western Balkan have experienced some economic growth that followed the post-socialist recession, it did not reflect also on better labour market performance, in other words it was considered a “jobless growth”.To address this issue, this paper provides a literature review of the notion of flexicurity and then investigates the relevance of flexicurity for the countries of the Western Balkans through its found components (flexible and reliable contractual arrangements, lifelong learning, active employment policies and social security system). Even though flexicurity can be a way out for low performed economies it is considered as highly costly.