Impact Of Labour Market Regulations Research Articles

Empirical analysis on the impact of labour market regulations on uninsured employment in Greece

The impact of labour market regulations on uninsured employment in Greece between 2014 and 2019 is a crucial exploration in response to the pervasive challenge of undeclared work. With the rise of globalization and evolving labour dynamics, understanding and addressing the complexities of uninsured employment by analysing data from the Greek Ministry of Labour and Social Affairs was the main purpose of this study. Employing a comprehensive examination of key indicators, the study sought to evaluate the effectiveness of measures in curbing undeclared work. The pivotal strategies implemented by the Ministry of Labour and Social Affairs during the specified period were analysed using statistical analysis, focusing on high fines, reduced non-salary costs, the ERGANI information system, and a modernized fines framework. Statistical graphs were utilized to examine trends, providing a solid foundation for evaluating the impact of the implemented strategies. Qualitative assessments were employed to offer a nuanced understanding of the contextual factors influencing the outcomes. The findings reveal a positive trend, showcasing a significant reduction in undeclared workers and non-compliant businesses, underscoring the effectiveness of the implemented measures. An examination of 237,455 businesses in Greece over the period 2014-2019 revealed that 28,044 entities (11.81%) employed undeclared workers. Among 812,460 scrutinized employees, 44,642 (5.49%) were identified as undeclared, leading to fines totalling €468,997,663 in efforts to address non-compliance with labour regulations. This study not only sheds light on the successful strategies adopted by the Greek government but also offers valuable practical lessons for policymakers globally

Minimum wage increases and agricultural employment of locals and guest workers

We estimate the impact of the minimum wage on US farm worker employment by exploiting state-level variation in recent minimum wage increases. A $1.00 increase in the minimum wage decreases the likelihood of employment for an individual farm worker by around one percentage point, with the effect concentrated among native and naturalized US citizens. However, we find no evidence of a relationship between minimum wage and either the number of farm workers or guest workers. The difference between these results may be due to lower international migration to high minimum wage states. Citizenship and immigration status can influence the impact of labor market regulations on the farm workforce.

The original sin: Firms’ dynamics and the life-cycle consequences of economic conditions at birth

This paper presents new evidence suggesting that the aggregate conditions faced by businesses in the year of birth affect their performance over the entire life cycle. Using a unique employer–employee dataset that covers the universe of Italian businesses over the period 1975–2017, we document that businesses born during recessions start on a larger scale and remain larger compared to businesses born during expansions. These effects persist when we account for: fixed effects at sectoral, provincial and time level; exit attrition; regional and sectoral economic conditions; firm common characteristics; firms’ quality; and business formation. We then exploit the reform of the dismissal procedure implemented in Italy in 1990 for gauging the impact of labour market regulation on business creation. We find that a tightening of employment protection widens the employment gap in favour of recessionary startups. The evidence in the paper supports a countercyclical mechanism of selection at entry.

What is the Impact of Labour Market Regulation on Employment in LICs? How Does it Vary by Gender?

There is an extensive empirical literature examining the impacts of various labour market regulations on employment outcomes. However, much of this evidence focuses on developed or middle-income countries, resulting in a comparative dearth of literature that analyzes the impact of such policies in low-income countries (LICs). In addition, there are few studies that examine the impacts of such regulations by gender. This systematic review aims to synthesize the literature by focusing on the impact of labour market regulation on employment in LICs and how it varies by gender.

The impact of labour market regulations on (potential) entrepreneurs: the case of Germany

This paper explores the impact of German labour market regulations on the willingness of labour market entrants to start their own business. We study the legal situation, the actual and the perceived constraints imposed on businesses as well as the actual flexibility available of start-ups. We find strong evidence that labour market regulations are often misperceived in Germany. Furthermore, these misperceptions distort the willingness to become selfemployed. Start-ups are de jure hardly affected by labour market regulations because of a large number of exemptions. They are able to use a number of flexibility measures and thereby avoid regulatory restrictions. However, perceptions are quite the opposite, particularly in legal areas with high media coverage. This leads to a strong reluctance of labour market entrants to consider a start-up. Thus, measures aiming at increasing entrepreneurship should place strong emphasis on accurate knowledge of regulatory constraints and particularly in Germany, on less sceptical media coverage.

Protestantism, Labor Force Participation, and Employment Across Countries

Abstract. Using data from 80 countries, this article analyzes whether Protestant religion affects labor market outcomes. Controlling for the impact of labor market regulations, business regulations, the tax burden, the business cycle, the level of economic development, demographic and geographical conditions, wars, and the transition from planned to market economy as well as unobserved country and year effects, we find that countries in which the largest portion of the population practices Protestant religion have substantially higher labor force participation and employment rates, particularly among women. We obtain the same result for a subgroup of 19 industrial countries for which we have better data to control for the impact of labor market institutions and business cycle fluctuations.

The Impact of Labour Market Regulations on Entrepreneurship: The Case of Germany

This paper explores the impact of German labour market regulations on the willingness of young labour market entrants to start their own business rather than just becoming an employee. We study the legal situation, the actual and perceived constraints imposed on businesses and the actual flexibility available to young/small businesses. We find strong evidence that labour market regulations are often misperceived in Germany and that these misperceptions distort the willingness to become self-employed. Start-ups are de jure hardly affected by labour market regulations because of a large number of exemptions for small businesses and they are able to use a number of functional flexibility measures and thereby avoid regulatory restrictions, but perceptions are quite the opposite, particularly in legal areas with high media coverage. This leads to a strong reluctance to consider starting a business at a very early stage. Thus, measures aiming at increasing entrepreneurship should place strong emphasis on accurate knowledge of regulatory constraints and, particularly in Germany less sceptical media coverage.

Labour market reforms and economic growth – the European experience in the 1990s

Purpose – The purpose of this paper is to reassess the relative impact of labour market regulation on economic performance. Inflexible labour markets combined with high welfare costs are often thought to be the main cause of low growth in Europe.Design/methodology/approach – This paper compares the impact of labour market regulation to that of macroeconomic policies (such as fiscal policy, monetary policy, macroeconomic cost management) and to that of investment into future growth (such as research, education and the diffusion of technology). We develop for this purpose a highly stylised model explaining economic growth; we suggest a synthetic measure of performance and use data for the US and Europe for the empirical test.Findings – The main result is that regulation impacts on growth, the impact of regulatory change is, however, less easy to demonstrate. The impact of macro economic policy can be demonstrated first by the more growth oriented monetary and fiscal policy in the US and the success of some ...

Evaluating the Impact of Labour Market Regulation on the Size Growth of Firms

The Italian law on unfair firing (art. 18 of Statuto dei Lavoratori) discriminates according to whether the firm is below or above the threshold of 15 employees. In this paper we investigate the effects of the law on size growth of firms. The database consists of company level information collected by an ad hoc survey conducted by ISAE on a sample of industrial firms. The approach used is based on the methodology known as Regression Discontinuity Design. The analysis is built around two estimation exercises. In the first (sharp RDD), firms are assigned to the subset above (below) the threshold established by the law according to whether, in the base year, the total number of employees is greater or less than 15 (deterministic rule, rigid application of the law). In the second exercise, we introduce the hypothesis that the selection is partly stochastic because it is influenced by non-observable factors largely endogenous to the firms. The evidence of two empirical exercises indicates a negative impact of approximately 2% on the size growth of firms close to the threshold.

Reflections on the curious absence of employers, labour market incentives and labour market regulation in English 14–19 policy: first signs of a change in direction?

This article explores the previously quite marked absence from English policy debates on 14–19 education of issues that, in other developed countries, would be seen as key elements in the policy landscape. These are: the role of employers as providers of learning; the structure of employers’demand for skills, their recruitment and selection practices and the incentives this creates; the impact of labour market regulation on patterns of post‐compulsory participation in vocational education and training. This article argues that these issues help explain our comparatively modest participation rates at 16–18 and that failure to confront such underlying structural factors makes progress on the kind of agenda raised by Tomlinson and the subsequent White Paper extremely problematic. It is suggested that recent developments may mark the start of a change in policy, with labour market issues gaining a new prominence. The article concentrates on the English institutional context, but many of the general points about the labour market and its interaction with young peoples’decisions about education and training hold good across the whole of the UK.

Who Benefits from Labor Market Regulations? Chile 1960-1998

Economists have examined the impact of labor market regulations on the level of employment. However, there are many reasons to suspect that the impact of regulations differs across types of workers. In this paper we take advantage of the unusually large variance in labor policy in Chile to examine how different labor market regulations affect the distribution of employment and the employment rates across age, gender and skill levels. To this effect, we use a sample of repeated cross-section household surveys spanning the period 1960-1998 and measures of the evolution of job security provisions and minimum wages across time. Our results suggest large distribution effects. We find that employment security provisions and minimum wages reduce the share of youth and unskilled employment as well as their employment rates. We also find large effects on the distribution of employment between women and men.

The Impact of Labor Market Regulations

The authors investigate the impact of labor market regulations in settings where compliance is incomplete. They review some stylized facts about labor market behavior, present an analytical model that may explain such behavior, and provide a checklist for assessing the distortionary impact of a regulation such as the minimum wage. They take as their starting point the limited evidence about the distortionary effects of such regulations and argue that there may be natural limits on the efficiency losses engendered by labor market regulations. First, the regulations may not be binding at market equilibrium. For example, minimum wages may be set so low that they are ineffective. Second, even if they are binding, the relevant elasticities of supply and demand may be so low that the regulations have little impact on efficiency. Third, even if the regulations are binding and elasticities are sizable, compliance may be low. The authors argue that the likelihood of compliance will be greatest when the regulations are binding and the relevant elasticities are sizable. That is, if the distortionary costs of regulations are not rendered insignificant by the first two reasons, then the returns to noncompliance will be high and, other things being equal, employers will evade or avoid the regulations, thereby minimizing the imact on efficiency. The argument rests on profit maximization subject to a hard budget constraint. Public enterprises, which are not concerned only with profit maximization and often have softer budget constraints than the private sector, may be more willing to conform to profit-reducing regulations, but in this case the authors argue that compliance may reduce already-existing efficiency losses.