EconPapers    
Economics at your fingertips  
 

Labor market reforms and the monetary policy environment

Povilas Lastauskas and Julius Stakėnas

European Economic Review, 2020, vol. 128, issue C

Abstract: Do labor market reforms initiated in periods of loose monetary policy yield different outcomes from those that were introduced in periods when monetary tightening prevailed? The answer to this question is a firm, yes. We document the vital role of accommodative monetary policy for an increase in unemployment benefits, spending on active labor market policies, and labor market deregulation to boost growth and reduce unemployment. It was found that if interest rates cannot be reduced, then unemployment benefits should be lowered. A more rigid labor market, it was further found, can deliver expansionary effects, especially during the crisis period.

Keywords: Labor market reforms; Macroeconomic impacts; Monetary union; Crisis; Low and high interest rate environments (search for similar items in EconPapers)
JEL-codes: C33 C54 E52 E62 J08 J38 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0014292120301409
Full text for ScienceDirect subscribers only

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:eee:eecrev:v:128:y:2020:i:c:s0014292120301409

DOI: 10.1016/j.euroecorev.2020.103509

Access Statistics for this article

European Economic Review is currently edited by T.S. Eicher, A. Imrohoroglu, E. Leeper, J. Oechssler and M. Pesendorfer

More articles in European Economic Review from Elsevier
Bibliographic data for series maintained by Haili He ().

 
Page updated 2020-11-26
Handle: RePEc:eee:eecrev:v:128:y:2020:i:c:s0014292120301409