Employment dynamics, growth and institutions : empirical evidence from OECD countries
This thesis focuses on the determinants of unemployment in the OECD countries. In particular, we look at three different explanations of unemployment and analyse their potential impact on labour market dynamics. The three explanations under consideration are technological factors, capital flows and capital market integration, and labour market institutions. Chapter 1 and 2 focus on the relationship between technological progress and unemployment. We specify and estimate a structural model of labour demand, wage setting, and capital accumulation, for a panel of EU countries, the United States and Japan over the period 1960-1995. The adjustment paths of unemployment, following a shock to productivity growth, are traced explicitly in simulation exercises. Chapter 3 focuses on the labour market effects of high international (physical) capital mobility. The aim of this part of the thesis is to assess whether, and to what extent, capital flows contribute to unemployment volatility. We test the effects of capital mobility on unemployment persistence and on the adjustment dynamics of unemployment in response to TFP shocks. Finally, Chapters 4 and 5 examine job flows characteristics in the 1990s for a sample of 16 European countries. Using unique homogenous firm-level data, we provide comparable estimates of job flows and identify cross-country differences and similarities. We also look at the impact of institutional differences on job reallocation. The effects of the business cycle on job flows, and to what extent flring restrictions may affect the cyclicality of job flows, are also considered.