Labor-market volatility and financial development in the advanced OECD countries: Does labor market regulation matter?

Abstract : This article investigates the relationship between financial development and labor market volatility in 15 OECD countries from 1974 to 2007. I argue that financial development should affect corporate governance and then how firms will determine wages and the number of hours worked, especially for low-skilled workers. First, my results indicate that financial development is associated with higher employment and wage volatility, but with no significant differences across skill levels. Second, using a threshold regression model, I show that the increasing-effect of higher financial development on labor-market volatility is larger in countries with more labor market regulation.
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https://hal-paris1.archives-ouvertes.fr/hal-01248986
Contributor : Thibault Darcillon <>
Submitted on : Tuesday, December 29, 2015 - 5:20:45 PM
Last modification on : Tuesday, January 30, 2018 - 5:50:04 PM

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Thibault Darcillon. Labor-market volatility and financial development in the advanced OECD countries: Does labor market regulation matter?. Comparative Economic Studies, Palgrave Macmillan, 2016. ⟨hal-01248986⟩

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