East German unemployment: the myth of the irrelevant labor market
Christian Merkl and
Dennis J. Snower
No 1435, Kiel Working Papers from Kiel Institute for the World Economy (IfW Kiel)
Abstract:
This paper indicates that East Germany's unemployment originates primarily in the labor market, caused by the fast wage adjustment after German reunification. We model the resulting labor market traps in a search and matching framework, show that they are difficult to overcome, and provide empirical evidence. We argue that under these circumstances, demand-side policies are effective mainly when they increase the economy's overall productivity and thereby help overcome the labor market traps.
Keywords: Unemployment; labor market trap; East Germany (search for similar items in EconPapers)
JEL-codes: E24 J30 J64 P2 (search for similar items in EconPapers)
Date: 2008
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)
Downloads: (external link)
https://www.econstor.eu/bitstream/10419/24830/1/572548079.PDF (application/pdf)
Related works:
Journal Article: East German unemployment: the myth of the irrelevant labor market (2008) 
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
HTML/Text
Persistent link: https://EconPapers.repec.org/RePEc:zbw:ifwkwp:1435
Access Statistics for this paper
More papers in Kiel Working Papers from Kiel Institute for the World Economy (IfW Kiel) Contact information at EDIRC.
Bibliographic data for series maintained by ZBW - Leibniz Information Centre for Economics ().