Labor and product market reforms: questioning policy complementarity

Bruno Amable and Donatella Gatti

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

Abstract: This article proposes a dynamic efficiency wages model with imperfect competition on labor and product markets. In this framework, job insecurity generates a perverse effect on workers incentives, which shifts up the real wages schedule and may yield employment losses. Product market regulation and redundancy payments contribute to reducing labor turnover, thus easing the workers incentive constraint. Consequently, and against conventional wisdom, regulations may have a positive impact on employment, and a substitution effect may emerge across deregulation policies. Moreover, in some cases, a complementarity arises between regulations in product and labor markets, both interacting to ensure more stable labor relations.

Keywords: unemployment; product market; labour market; competition; policy complementarity; institutional complementarity (search for similar items in EconPapers)
Date: 2006-02
References: Add references at CitEc
Citations: View citations in EconPapers (15)

Published in Industrial and Corporate Change, 2006, 15 (1), pp.101-122. ⟨10.1093/icc/dtj004⟩

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
Journal Article: Labor and product market reforms: questioning policy complementarity (2006)
Working Paper: Labor and product market reforms: questioning policy complementarity (2006)
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:hal:cesptp:halshs-00176386

DOI: 10.1093/icc/dtj004

Access Statistics for this paper

More papers in Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) from HAL
Bibliographic data for series maintained by CCSD ().