Labor-market volatility and financial development in the advanced OECD countries: Does labor market regulation matter?

Thibault Darcillon

Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) from HAL

Abstract: This article investigates the relationship between financial development and labor market volatility in 15 OECD countries from 1974 to 2007. I argue that financial development should affect corporate governance and then how firms will determine wages and the number of hours worked, especially for low-skilled workers. First, my results indicate that financial development is associated with higher employment and wage volatility, but with no significant differences across skill levels. Second, using a threshold regression model, I show that the increasing-effect of higher financial development on labor-market volatility is larger in countries with more labor market regulation.

Keywords: Financial development; labor-market volatility; labor market regulation; social and welfare policies; threshold regression model (search for similar items in EconPapers)
Date: 2016
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Citations: View citations in EconPapers (4)

Published in Comparative Economic Studies, 2016

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Working Paper: Labor-market volatility and financial development in the advanced OECD countries: Does labor market regulation matter? (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:hal:cesptp:hal-01248986

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