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Employment regulation and productivity: Is there a case for deregulation?

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Listed:
  • Brookes, Michael
  • James, Philip
  • Rizov, Marian

Abstract

This paper explores empirically the economic validity of the relatively limited approach to the regulation of employment protection pursued in the UK over the last three decades and within the European Union more recently. It does so by comparing the UK’s manufacturing labour productivity performance with those of three countries – France, Germany and Sweden – that possess more stringent employment protection laws. The findings reveal that while productivity growth in the UK was superior to France and Sweden, it was lower than in Germany. More generally, the study’s findings fail to support the existence of a straightforward negative relationship between regulatory stringency and productivity growth.

Suggested Citation

  • Brookes, Michael & James, Philip & Rizov, Marian, 2016. "Employment regulation and productivity: Is there a case for deregulation?," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 39(3), pages 381-403.
    • Handle: RePEc:zbw:espost:182574
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    References listed on IDEAS

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    More about this item

    Keywords

    Employment protection; labour productivity; legal regulation; Europe;
    All these keywords.

    JEL classification:

    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J38 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Public Policy
    • J53 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Labor-Management Relations; Industrial Jurisprudence
    • J83 - Labor and Demographic Economics - - Labor Standards - - - Workers' Rights
    • J88 - Labor and Demographic Economics - - Labor Standards - - - Public Policy

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