A comprehensive empirical modelling approach of institutional interdependencies

WWWforEurope Working Paper No. 7, 37 pages Reducing institutional rigidities in product and labour markets is key to lowering unemployment. The impact of such labour and product market reforms, however, depends crucially on the country-specific regulatory framework. In this paper, we estimate the country-specific impact of changes in six categories of institutional regulation conditional on the country-specific regulatory environment for a dynamic panel of 26 OECD countries.

labour market institution, institutional interdependencies, model selection, heuristic optimization

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