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Labour market institutions and labour market performance
Authors:Hartmut Lehmann  Alexander Muravyev
Institution:1. Department of Economics, University of Bologna, Italy and IZA. E‐mail: hartmut.lehmann@unibo.it;2. St. Petersburg University Graduate School of Management, Russia and IZA. E‐mail: muravyev@gsom.pu.ru
Abstract:This paper studies the relationship between labour market institutions and policies and labour market performance using a new and unique dataset that covers the countries of Eastern Europe and Central Asia, which in the last two decades experienced radical economic and institutional transformations. We document a clear trend towards liberalization of labour markets, especially in the countries of the former Soviet Union, but also substantial differences across the countries studied. Our econometric analysis implies that institutions matter for labour market outcomes, and that deregulation of labour markets improves their performance. The analysis also suggests several significant interactions between different institutions, which are in line with the idea of beneficial effects of reform complementarity and broad reform packages.
Keywords:E24  J21  P20  Labour market institutions  unemployment  transition economies
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