Labour Market Flexibility: More a Source of Macroeconomic Fragility than a Recipe for Growth

par G. Dosi (Scuola Superiore Sant’Anna, gdosi@sssup.it), M. C. Pereira (University of Campinas, marcelocpereira@uol.com.br), A. Roventini (OFCE et Scuola Superiore Sant’Anna, a.roventini@sssup.it), and M. E. Virgillito (Scuola Superiore Sant’Anna, m.virgillito@sssup.it)

During the years of the recent European crisis (and also before), the economic policy debate has been marked by the need of labour market structural reforms to boost productivity and GDP growth. This rhetoric has been particularly vivid in the European Union, especially during the current Euro crisis. And the  call for such reforms  finds support  in the  consensus among “mainstream” macroeconomists on the idea that labour market rigidities are the source of unemployment. The well-known OECD (1994) Jobs Study was among the first to advocate the benefits from labour market liberalization. The report and a series of subsequent papers basically argued that the roots of unemployment rest in social institutions and policies such as unions, unemployment benefits, employment protection legislation. Lire la suite de « Labour Market Flexibility: More a Source of Macroeconomic Fragility than a Recipe for Growth »

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