 Wage Compression, Employment Restrictions and Unemployment: The Case of MauritiusInternational Monetary Fund No 2004/205, IMF Working Papers from International Monetary Fund Abstract: Governments often intervene in labor markets with the aim of reducing inequality and promoting employment. Such intervention often results in wage compression and restrictions on how firms use their workers. This paper investigates the impact of such interventions on the labor market conditions faced by low-skill workers in Mauritius. It finds that even relatively minor intervention can dramatically increase the fragility of jobs, the length of unemployment spells, as well as the extent of unemployment and labor market churning. With institutions of the type studied here common across many different types of countries, these results have relatively general implications. Keywords: WP; job creation; Unemployment; Labor Market Restrictions; Wage Compression; quality firm-worker match; low-skill worker; determination process; worker redeployment; wage distribution; dislocation cost; equilibrium wage function; Labor markets; Wages; Job destruction; Western Europe (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:imf:imfwpa:2004/205 Ordering information: This working paper can be ordered from Access Statistics for this paper More papers in IMF Working Papers from International Monetary Fund International Monetary Fund, Washington, DC USA. Contact information at EDIRC. |
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