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Labour Market Transitions, Shocks and Institutions during the Great Recession: A Cross-Country Analysis

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  • Felder, Rahel
  • Bachmann, Ronald

Abstract

This paper analyses the impact of the Great Recession on labour market dynamics in industrialized countries. Using unique measures of labour market flows constructed from worker-level micro data, we examine to what extent macro shocks were transmitted to national labour markets. Following Blanchard and Wolfers (2000), we focus on the role of the interaction of shocks and institutions for labour market flows - in addition to the unemployment rate - in order to explain cross-country differences in labour market reactions to the Great Recession. Our results show that interactions between shocks and institutions have explanatory power when considering observable macroeconomic shocks; interactions with trade union variables are of particular relevance in this context.

Suggested Citation

  • Felder, Rahel & Bachmann, Ronald, 2016. "Labour Market Transitions, Shocks and Institutions during the Great Recession: A Cross-Country Analysis," VfS Annual Conference 2016 (Augsburg): Demographic Change 145851, Verein für Socialpolitik / German Economic Association.
    • Handle: RePEc:zbw:vfsc16:145851
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    References listed on IDEAS

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    JEL classification:

    • J60 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - General
    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • J08 - Labor and Demographic Economics - - General - - - Labor Economics Policies

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