Employment and Productivity in Industrialized Economies
Author(s)
Appelbaum, Eileen; Schettkat, Ronald
Abstract
Differences in unemployment rates in industrialized countries since the 1970s are often seen as the result of differences in labor market regulations and institutions. According to this view, highly regulated European economies were unable to respond to changes in the world market, while deregulation in the United States allowed firms to engage in employment expansion as the economy grew. However, endogenous forces may be challenging the traditional positive correlation between productivity, employment, and economic growth. Rather than stifling employment and productivity growth, institutions may now be offering policy options to response to structural changes in the world economy.
