Shocks and endogenous institutions: an agent-based model of labor market performance in turbulent times

Christian W. Martin and Michael Neugart

Publications of Darmstadt Technical University, Institute for Business Studies (BWL) from Darmstadt Technical University, Department of Business Administration, Economics and Law, Institute for Business Studies (BWL)

Abstract: We develop an agent-based model of labor market regulation to study the consequences of employment protection legislations for labor market performance. Unlike most of the existing studies of labor market regulation we endogenize the institutional setting. Workers cast their vote on labor market regulation depending on the past payoffs that they accrued when one of two competing parties with different labor market policy platforms was in power. We identify important interactions with exogenous shocks. In more turbulent economic times, employment protection systems can affect labor market performance for some periods even after the shock has subsided.

Date: 2009
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Published in Computational Economics 1 (2009) : pp. 31-46

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http://link.springer.com/article/10.1007%2Fs10614-008-9149-z
https://tuprints.ulb.tu-darmstadt.de/27437

Related works:
Journal Article: Shocks and Endogenous Institutions: An Agent-based Model of Labor Market Performance in Turbulent Times (2009)
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Persistent link: https://EconPapers.repec.org/RePEc:dar:wpaper:57257

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