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Employment and Labor Regulation: Evidence from Manufacturing Firms in Bolivia, 1988-2007

Author

Listed:
  • Beatriz Muriel

    (Institute for Advanced Development Studies (INESAD))

  • Gustavo Machicado

    (Institute for Advanced Development Studies (INESAD))

Abstract

This paper analyzes the effects of labor regulation on employment for Bolivian registered manufacturing firms during 1988 to 2007. By estimating job flows we find that firms with high temporary worker rates (as a proxy of lower labor regulation costs) are those with both higher job reallocation rates and higher net employment growth, and only they contributed to employment growth during the country economic downturn, 1998-1999. In addition, by estimating demand functions we find that labor regulation changes (measured through the compulsory basic salary and the major labor costs derived from the new pension law) entailed costs in terms of permanent employment losses.

Suggested Citation

  • Beatriz Muriel & Gustavo Machicado, 2014. "Employment and Labor Regulation: Evidence from Manufacturing Firms in Bolivia, 1988-2007," CEDLAS, Working Papers 0157, CEDLAS, Universidad Nacional de La Plata.
    • Handle: RePEc:dls:wpaper:0157
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    References listed on IDEAS

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    More about this item

    JEL classification:

    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • J01 - Labor and Demographic Economics - - General - - - Labor Economics: General
    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • K31 - Law and Economics - - Other Substantive Areas of Law - - - Labor Law

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