EconPapers    
Economics at your fingertips  
 

Labour-market institutions and their impact on trade partners: A quantitative analysis

Gabriel Felbermayr, Mario Larch and Wolfgang Lechthaler

Canadian Journal of Economics, 2015, vol. 48, issue 5, 1917-1943

Abstract: Recent theoretical literature studies how labour market reforms in one country can affect labour market outcomes in other countries, thereby rationalizing widely held policy beliefs and empirical evidence. But what is the quantitative relevance of such spillover effects? This paper combines two recent workhorse models: the canonical search-and-matching framework and the heterogeneous firms international trade model. Qualitatively, the framework confirms that labour market reforms in one country benefit its trading partners, replicating the stylized facts. However, when wages are bargained flexibly, the model quantitatively underestimates the correlation of structural unemployment rates across countries. Introducing some degree of real wage rigidity remedies this problem.

JEL-codes: F16 (search for similar items in EconPapers)
Date: 2015
References: Add references at CitEc
Citations: View citations in EconPapers (9)

Downloads: (external link)
https://doi.org/10.1111/caje.12185 (text/html)
access restricted to subscribers

Related works:
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:cje:issued:v:48:y:2015:i:5:p:1917-1943

Ordering information: This journal article can be ordered from
https://www.economic ... ionen/membership.php

Access Statistics for this article

Canadian Journal of Economics is currently edited by Zhiqi Chen

More articles in Canadian Journal of Economics from Canadian Economics Association Canadian Economics Association Prof. Werrner Antweiler, Treasurer UBC Sauder School of Business 2053 Main Mall Vancouver, BC, V6T 1Z2. Contact information at EDIRC.
Bibliographic data for series maintained by Prof. Werner Antweiler ().

 
Page updated 2025-03-19
Handle: RePEc:cje:issued:v:48:y:2015:i:5:p:1917-1943