The political consequences of unemployment

Gilles Saint-Paul

Economics Working Papers from Department of Economics and Business, Universitat Pompeu Fabra

Abstract: We analyze the channels by which an ill-functioning labor market changes the preferences of the people for public policy and therefore the decisions that are made. We not only discuss labour market reform but other important aspects of policy making such as the size and structure of government spending. The class of mechanisms that we highlight can be summarized as the very existence of unemployment generating political support for "sclerosis". This may help to explain the timid pace of reform, in particular the fact that any recovery sends them at the backfront of the political agenda, and the sometimes violent opposition generated by some measures, as we have seen mostly in France.

Keywords: Unemployment; rigidities; employment protection; political economy; european labour markets (search for similar items in EconPapers)
JEL-codes: E24 E6 J3 J6 (search for similar items in EconPapers)
Date: 1998-11
New Economics Papers: this item is included in nep-ltv, nep-pke and nep-pol
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (15)

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Persistent link: https://EconPapers.repec.org/RePEc:upf:upfgen:343

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