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Labour market policies and unemployment in the OECD

Jackman, Richard, Pissarides, Christopher ORCID: 0000-0002-0695-058X and Savouri, S (1990) Labour market policies and unemployment in the OECD. CEP Discussion Papers (CEPDP0011). London School of Economics and Political Science. Centre for Economic Performance, London, UK.

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The massive increase in unemployment throughout the OECD since the early 1970s has led governments in many countries to introduce, or to expand, labour market policies such as training schemes, employment subsidies, public works or schemes of counselling or assistance in job search. Such programmes have the objective of reducing unemployment by improving the workings of the labour market. This paper first briefly describes the types of programmes that have been introduced in many OECD countries in recent years. It then suggests a model of the labour market, based on the relationship of unemployment and vacancies (or Beveridge curve), within which the rise in unemployment can be analysed and the effects of policies and of institutions examined. Using the framework, we then identify the main factors causing shifts in unemployment and vacancy rates in 14 of the main OECD countries over the period 1970-88. Our main results are that while corporatism remains the institutional features with the biggest single impact in sustaining low unemployment rates, labour market policies also have a significant and well-defined effect on unemployment which appears large relative to the budgetary costs of the programmes.

Item Type: Monograph (Discussion Paper)
Official URL:
Additional Information: © 1990 the authors
Divisions: Centre for Economic Performance
Subjects: H Social Sciences > HD Industries. Land use. Labor
Date Deposited: 27 Apr 2007
Last Modified: 16 May 2024 11:15

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