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Reforms of Collective Bargaining Institutions in European Union Countries: Bad Timing, Bad Outcomes?

Yann Thommen ()

Working Papers of BETA from Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg

Abstract: This paper investigates whether flexibility-enhancing reforms of national collective bargaining systems have positive outcomes in terms of employment and unemployment in the short-term, especially when implemented during an economic downturn. The analysis consists in applying local projections to a novel panel database of reforms of collective bargaining institutions in EU countries in the period 2000-2018. There is no evidence that making collective bargaining institutions more flexible during a recession has a positive effect on employment or unemployment in the short term. More specifically, reforms that reduce bargaining coverage have negative short-term effects, particularly on the employment of young people and low-educated workers, and are associated with a decline in the share of temporary jobs. The results do not support the idea that collective bargaining institutions should be reformed during a recession to boost employment.

Keywords: Employment; Unemployment; Short-term effects; Labor market; Collective bargaining; Reforms. (search for similar items in EconPapers)
JEL-codes: E24 E32 J08 J21 J5 (search for similar items in EconPapers)
Date: 2020
New Economics Papers: this item is included in nep-cdm, nep-eec, nep-lab and nep-mac
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Handle: RePEc:ulp:sbbeta:2020-47