Employment and Wage Adjustment in Euroland's Labour Market

Helmut Hofer and Karl Pichelmann
Additional contact information
Karl Pichelmann: EC, DG II Economic and Financial Affairs

No 76, Economics Series from Institute for Advanced Studies

Abstract: The paper attempts to establish a few stylised facts about Euroland's labour market given the increasing importance of smoothly functioning markets in the EMU. We assemble econometric evidence regarding labour demand behaviour, wage-setting mechanisms and the cyclicality of unemployment in Euroland. We find that in the 1990s unemployment cyclicality has been higher in Euroland than in the US, while the opposite was true in the previous two decades. The main reason for this is to be found in Euroland's employment now responding much stronger to cyclical fluctuations in output than in the past, and even somewhat stronger than in the US. Thus, it appears rather implausible that overall too strict employment protection regulations can still offer a convincing explanation for a significant part of Euroland's problem of persistently high unemployment. There can be little doubt, however, that wage bargaining in Euroland continues to suffer from a serious insider-outsider problem.

Keywords: Unemployment; Wage-setting mechanisms; European Monetary Union (search for similar items in EconPapers)
JEL-codes: E24 J30 J64 (search for similar items in EconPapers)
Pages: 23 pages
Date: 1999-12
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

Downloads: (external link)
https://irihs.ihs.ac.at/id/eprint/1226 First version, 1999 (application/pdf)

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:ihs:ihsesp:76

Ordering information: This working paper can be ordered from
Institute for Advanced Studies - Library, Josefstädterstr. 39, A-1080 Vienna, Austria

Access Statistics for this paper

More papers in Economics Series from Institute for Advanced Studies Josefstädterstr. 39, A-1080 Vienna, Austria. Contact information at EDIRC.
Bibliographic data for series maintained by Doris Szoncsitz ().