Labor Market Regulations : What Do We Know about Their Impacts in Developing Countries?

Labor market regulation is a high-profile, and often contentious, area of public policy. Although these regulations have been studied most extensively in developed countries, there is a growing body of literature on their effects in developing coun...

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Bibliographic Details
Main Author: Betcherman, Gordon
Format: Policy Research Working Paper
Language:English
en_US
Published: World Bank, Washington, DC 2014
Subjects:
Online Access:http://documents.worldbank.org/curated/en/2014/03/19303517/labor-market-regulations-know-impacts-developing-countries
http://hdl.handle.net/10986/17732
id okr-10986-17732
recordtype oai_dc
repository_type Digital Repository
institution_category Foreign Institution
institution Digital Repositories
building World Bank Open Knowledge Repository
collection World Bank
language English
en_US
topic ACCOUNTING
ACTIVE LABOR
ACTIVE LABOR MARKET
ACTIVE LABOR MARKET PROGRAMS
ADVERSE EFFECTS
AGGREGATE EMPLOYMENT
ASSESSING LABOR MARKET
BARGAINING POWER
BUSINESS CYCLE
CAPITAL INVESTMENTS
COLLECTIVE BARGAINING
COLLECTIVE DISMISSAL
COMPETITIVENESS
CONTRACT LABOR
CREATIVE DESTRUCTION
CROSS-SECTIONAL DATA
DEVELOPMENT ECONOMICS
DISMISSAL
DISTRIBUTION OF INCOME
EARNING
EARNINGS INEQUALITY
ECONOMIC CONDITIONS
ECONOMIC EFFECTS
ECONOMIC EFFICIENCY
ECONOMIC GROWTH
ECONOMIC POLICIES
ECONOMIC THEORY
EMPLOYMENT
EMPLOYMENT DURATION
EMPLOYMENT DYNAMICS
EMPLOYMENT EFFECT
EMPLOYMENT EFFECTS
EMPLOYMENT FORMS
EMPLOYMENT GROWTH
EMPLOYMENT IMPACT
EMPLOYMENT IMPACTS
EMPLOYMENT LEVELS
EMPLOYMENT OPPORTUNITIES
EMPLOYMENT OUTLOOK
EMPLOYMENT PATTERNS
EMPLOYMENT PERFORMANCE
EMPLOYMENT PROTECTION LEGISLATION
EMPLOYMENT PROTECTION RULES
EXOGENOUS VARIABLES
FAIR
FINANCIAL MARKET
FIRING COSTS
FIRM ENTRY
FIRM SIZE
FIRM SIZE DISTRIBUTION
GENERAL EQUILIBRIUM
HIGH UNEMPLOYMENT
HIGH UNEMPLOYMENT RATES
HUMAN CAPITAL
HUMAN RESOURCES
IMPERFECT INFORMATION
INCOME
INDUSTRIAL LABOR
INDUSTRIAL RELATIONS
INFORMAL EMPLOYMENT
INFORMAL SECTOR
INFORMAL SECTOR WORKERS
INNOVATION
INNOVATIONS
JOB CREATION
JOB LOSS
JOB MARKET
JOB PERFORMANCE
JOB SECURITY
JOB TENURE
JOB TURNOVER
JOBS
LABOR ADJUSTMENT
LABOR COSTS
LABOR DEMAND
LABOR ECONOMICS
LABOR FORCE
LABOR LAWS
LABOR LEGISLATION
LABOR MARKET
LABOR MARKET DYNAMICS
LABOR MARKET FLEXIBILITY
LABOR MARKET INSTITUTIONS
LABOR MARKET OUTCOMES
LABOR MARKET PERFORMANCE
LABOR MARKET POLICIES
LABOR MARKET REFORM
LABOR MARKET REFORMS
LABOR MARKET REGULATION
LABOR MARKET REGULATIONS
LABOR MARKET RIGIDITIES
LABOR MARKETS
LABOR POLICIES
LABOR PRODUCTIVITY
LABOR PRODUCTIVITY GROWTH
LABOR REALLOCATION
LABOR REGULATION
LABOR REGULATIONS
LABOR RELATIONS
LABOR SUPPLY
LABOR TURNOVER
LABOUR
LABOUR DEMAND
LABOUR LAWS
LABOUR MARKET
LABOUR MARKET INSTITUTIONS
LABOUR MARKET PERFORMANCE
LABOUR MARKET POLICIES
LABOUR MARKET REFORM
LABOUR MARKET REFORMS
LABOUR MARKET REGULATION
LABOUR REALLOCATION
LABOUR REGULATION
LABOUR STUDIES
LAYOFFS
LEARNING
LITERATURE
LIVING STANDARDS
LOW UNEMPLOYMENT
LOW-WAGE EMPLOYMENT
MARKET DEVELOPMENTS
MARKET DISTORTIONS
MARKET FAILURES
MARKET INTEGRATION
MARKET POWER
MARKET WAGES
MIGRATION
MINIMUM WAGE
MINIMUM WAGES
MOTIVATION
MULTIFACTOR PRODUCTIVITY
MULTIFACTOR PRODUCTIVITY GROWTH
MUNICIPALITIES
OCCUPATION
OPEN ACCESS
PAPERS
PENALTIES
PERMANENT EMPLOYMENT
PERMANENT JOBS
PERMANENT WORKER
PERMANENT WORKERS
POLITICAL ECONOMY
POLITICAL PROCESS
PRODUCTIVITY EFFECT
PRODUCTIVITY EFFECTS
PRODUCTIVITY GROWTH
PRODUCTIVITY LEVELS
PUBLIC FINANCE
PUBLIC POLICY
REGULAR CONTRACTS
REGULAR WORKERS
REGULATORY FRAMEWORK
RESEARCH FINDINGS
RESEARCH INSTITUTE
RESEARCH METHODS
RESEARCHERS
RISK MANAGEMENT
SEVERANCE PAYMENTS
SOCIAL COHESION
SOCIAL RESPONSIBILITY
STRUCTURAL ADJUSTMENT
SUBSTITUTION
SUBSTITUTION EFFECT
TAX ADMINISTRATION
TEMPORARY EMPLOYMENT
TOTAL FACTOR PRODUCTIVITY
TRADE UNIONS
TRAINING COSTS
TRANSACTION COSTS
UNEMPLOYMENT
UNEMPLOYMENT INSURANCE
UNEMPLOYMENT RATE
UNION DENSITY
UNSKILLED LABOR
UNSKILLED WORKERS
WAGE BILL
WAGE COMPRESSION
WAGE DIFFERENTIALS
WAGE DISPERSION
WAGE DISTRIBUTION
WAGE EFFECT
WAGE EFFECTS
WAGE FLOOR
WAGE GAINS
WAGE INCREASE
WAGE INCREASES
WAGE INEQUALITY
WAGE POLICIES
WAGE POLICY
WAGE SET
WORKER
WORKERS
WORKING CONDITIONS
spellingShingle ACCOUNTING
ACTIVE LABOR
ACTIVE LABOR MARKET
ACTIVE LABOR MARKET PROGRAMS
ADVERSE EFFECTS
AGGREGATE EMPLOYMENT
ASSESSING LABOR MARKET
BARGAINING POWER
BUSINESS CYCLE
CAPITAL INVESTMENTS
COLLECTIVE BARGAINING
COLLECTIVE DISMISSAL
COMPETITIVENESS
CONTRACT LABOR
CREATIVE DESTRUCTION
CROSS-SECTIONAL DATA
DEVELOPMENT ECONOMICS
DISMISSAL
DISTRIBUTION OF INCOME
EARNING
EARNINGS INEQUALITY
ECONOMIC CONDITIONS
ECONOMIC EFFECTS
ECONOMIC EFFICIENCY
ECONOMIC GROWTH
ECONOMIC POLICIES
ECONOMIC THEORY
EMPLOYMENT
EMPLOYMENT DURATION
EMPLOYMENT DYNAMICS
EMPLOYMENT EFFECT
EMPLOYMENT EFFECTS
EMPLOYMENT FORMS
EMPLOYMENT GROWTH
EMPLOYMENT IMPACT
EMPLOYMENT IMPACTS
EMPLOYMENT LEVELS
EMPLOYMENT OPPORTUNITIES
EMPLOYMENT OUTLOOK
EMPLOYMENT PATTERNS
EMPLOYMENT PERFORMANCE
EMPLOYMENT PROTECTION LEGISLATION
EMPLOYMENT PROTECTION RULES
EXOGENOUS VARIABLES
FAIR
FINANCIAL MARKET
FIRING COSTS
FIRM ENTRY
FIRM SIZE
FIRM SIZE DISTRIBUTION
GENERAL EQUILIBRIUM
HIGH UNEMPLOYMENT
HIGH UNEMPLOYMENT RATES
HUMAN CAPITAL
HUMAN RESOURCES
IMPERFECT INFORMATION
INCOME
INDUSTRIAL LABOR
INDUSTRIAL RELATIONS
INFORMAL EMPLOYMENT
INFORMAL SECTOR
INFORMAL SECTOR WORKERS
INNOVATION
INNOVATIONS
JOB CREATION
JOB LOSS
JOB MARKET
JOB PERFORMANCE
JOB SECURITY
JOB TENURE
JOB TURNOVER
JOBS
LABOR ADJUSTMENT
LABOR COSTS
LABOR DEMAND
LABOR ECONOMICS
LABOR FORCE
LABOR LAWS
LABOR LEGISLATION
LABOR MARKET
LABOR MARKET DYNAMICS
LABOR MARKET FLEXIBILITY
LABOR MARKET INSTITUTIONS
LABOR MARKET OUTCOMES
LABOR MARKET PERFORMANCE
LABOR MARKET POLICIES
LABOR MARKET REFORM
LABOR MARKET REFORMS
LABOR MARKET REGULATION
LABOR MARKET REGULATIONS
LABOR MARKET RIGIDITIES
LABOR MARKETS
LABOR POLICIES
LABOR PRODUCTIVITY
LABOR PRODUCTIVITY GROWTH
LABOR REALLOCATION
LABOR REGULATION
LABOR REGULATIONS
LABOR RELATIONS
LABOR SUPPLY
LABOR TURNOVER
LABOUR
LABOUR DEMAND
LABOUR LAWS
LABOUR MARKET
LABOUR MARKET INSTITUTIONS
LABOUR MARKET PERFORMANCE
LABOUR MARKET POLICIES
LABOUR MARKET REFORM
LABOUR MARKET REFORMS
LABOUR MARKET REGULATION
LABOUR REALLOCATION
LABOUR REGULATION
LABOUR STUDIES
LAYOFFS
LEARNING
LITERATURE
LIVING STANDARDS
LOW UNEMPLOYMENT
LOW-WAGE EMPLOYMENT
MARKET DEVELOPMENTS
MARKET DISTORTIONS
MARKET FAILURES
MARKET INTEGRATION
MARKET POWER
MARKET WAGES
MIGRATION
MINIMUM WAGE
MINIMUM WAGES
MOTIVATION
MULTIFACTOR PRODUCTIVITY
MULTIFACTOR PRODUCTIVITY GROWTH
MUNICIPALITIES
OCCUPATION
OPEN ACCESS
PAPERS
PENALTIES
PERMANENT EMPLOYMENT
PERMANENT JOBS
PERMANENT WORKER
PERMANENT WORKERS
POLITICAL ECONOMY
POLITICAL PROCESS
PRODUCTIVITY EFFECT
PRODUCTIVITY EFFECTS
PRODUCTIVITY GROWTH
PRODUCTIVITY LEVELS
PUBLIC FINANCE
PUBLIC POLICY
REGULAR CONTRACTS
REGULAR WORKERS
REGULATORY FRAMEWORK
RESEARCH FINDINGS
RESEARCH INSTITUTE
RESEARCH METHODS
RESEARCHERS
RISK MANAGEMENT
SEVERANCE PAYMENTS
SOCIAL COHESION
SOCIAL RESPONSIBILITY
STRUCTURAL ADJUSTMENT
SUBSTITUTION
SUBSTITUTION EFFECT
TAX ADMINISTRATION
TEMPORARY EMPLOYMENT
TOTAL FACTOR PRODUCTIVITY
TRADE UNIONS
TRAINING COSTS
TRANSACTION COSTS
UNEMPLOYMENT
UNEMPLOYMENT INSURANCE
UNEMPLOYMENT RATE
UNION DENSITY
UNSKILLED LABOR
UNSKILLED WORKERS
WAGE BILL
WAGE COMPRESSION
WAGE DIFFERENTIALS
WAGE DISPERSION
WAGE DISTRIBUTION
WAGE EFFECT
WAGE EFFECTS
WAGE FLOOR
WAGE GAINS
WAGE INCREASE
WAGE INCREASES
WAGE INEQUALITY
WAGE POLICIES
WAGE POLICY
WAGE SET
WORKER
WORKERS
WORKING CONDITIONS
Betcherman, Gordon
Labor Market Regulations : What Do We Know about Their Impacts in Developing Countries?
relation Policy Research Working Paper;No. 6819
description Labor market regulation is a high-profile, and often contentious, area of public policy. Although these regulations have been studied most extensively in developed countries, there is a growing body of literature on their effects in developing countries. This paper reviews that literature and focuses on the impacts of two important types of labor market regulation, minimum wages and employment protection legislation (EPL), on employment, earnings, and productivity. Strong and opposing views exist regarding the costs and benefits of these regulations, but the results of this review suggest that their impacts are generally smaller than the heat of the debates would suggest. Efficiency effects are found sometimes, but not always, and the effects can be in either direction and are usually modest. The distributional impacts of both minimum wage and employment protection legislation are clearer, with two effects predominating: an equalizing effect among covered workers, but with groups such as youth, women, and the less skilled disproportionately outside the coverage and its benefits. Although the overall conclusion is one of modest effects in most cases, the policy implication is not that these regulations do not matter. On the one hand, both minimum wages and EPL can affect distributional objectives. On the other hand, these regulations can generate undesirable economic or social impacts if they are established or operate in ways that exacerbate the labor market imperfections that they were designed to address.
format Publications & Research :: Policy Research Working Paper
author Betcherman, Gordon
author_facet Betcherman, Gordon
author_sort Betcherman, Gordon
title Labor Market Regulations : What Do We Know about Their Impacts in Developing Countries?
title_short Labor Market Regulations : What Do We Know about Their Impacts in Developing Countries?
title_full Labor Market Regulations : What Do We Know about Their Impacts in Developing Countries?
title_fullStr Labor Market Regulations : What Do We Know about Their Impacts in Developing Countries?
title_full_unstemmed Labor Market Regulations : What Do We Know about Their Impacts in Developing Countries?
title_sort labor market regulations : what do we know about their impacts in developing countries?
publisher World Bank, Washington, DC
publishDate 2014
url http://documents.worldbank.org/curated/en/2014/03/19303517/labor-market-regulations-know-impacts-developing-countries
http://hdl.handle.net/10986/17732
_version_ 1764438215537721344
spelling okr-10986-177322021-04-23T14:03:40Z Labor Market Regulations : What Do We Know about Their Impacts in Developing Countries? Betcherman, Gordon ACCOUNTING ACTIVE LABOR ACTIVE LABOR MARKET ACTIVE LABOR MARKET PROGRAMS ADVERSE EFFECTS AGGREGATE EMPLOYMENT ASSESSING LABOR MARKET BARGAINING POWER BUSINESS CYCLE CAPITAL INVESTMENTS COLLECTIVE BARGAINING COLLECTIVE DISMISSAL COMPETITIVENESS CONTRACT LABOR CREATIVE DESTRUCTION CROSS-SECTIONAL DATA DEVELOPMENT ECONOMICS DISMISSAL DISTRIBUTION OF INCOME EARNING EARNINGS INEQUALITY ECONOMIC CONDITIONS ECONOMIC EFFECTS ECONOMIC EFFICIENCY ECONOMIC GROWTH ECONOMIC POLICIES ECONOMIC THEORY EMPLOYMENT EMPLOYMENT DURATION EMPLOYMENT DYNAMICS EMPLOYMENT EFFECT EMPLOYMENT EFFECTS EMPLOYMENT FORMS EMPLOYMENT GROWTH EMPLOYMENT IMPACT EMPLOYMENT IMPACTS EMPLOYMENT LEVELS EMPLOYMENT OPPORTUNITIES EMPLOYMENT OUTLOOK EMPLOYMENT PATTERNS EMPLOYMENT PERFORMANCE EMPLOYMENT PROTECTION LEGISLATION EMPLOYMENT PROTECTION RULES EXOGENOUS VARIABLES FAIR FINANCIAL MARKET FIRING COSTS FIRM ENTRY FIRM SIZE FIRM SIZE DISTRIBUTION GENERAL EQUILIBRIUM HIGH UNEMPLOYMENT HIGH UNEMPLOYMENT RATES HUMAN CAPITAL HUMAN RESOURCES IMPERFECT INFORMATION INCOME INDUSTRIAL LABOR INDUSTRIAL RELATIONS INFORMAL EMPLOYMENT INFORMAL SECTOR INFORMAL SECTOR WORKERS INNOVATION INNOVATIONS JOB CREATION JOB LOSS JOB MARKET JOB PERFORMANCE JOB SECURITY JOB TENURE JOB TURNOVER JOBS LABOR ADJUSTMENT LABOR COSTS LABOR DEMAND LABOR ECONOMICS LABOR FORCE LABOR LAWS LABOR LEGISLATION LABOR MARKET LABOR MARKET DYNAMICS LABOR MARKET FLEXIBILITY LABOR MARKET INSTITUTIONS LABOR MARKET OUTCOMES LABOR MARKET PERFORMANCE LABOR MARKET POLICIES LABOR MARKET REFORM LABOR MARKET REFORMS LABOR MARKET REGULATION LABOR MARKET REGULATIONS LABOR MARKET RIGIDITIES LABOR MARKETS LABOR POLICIES LABOR PRODUCTIVITY LABOR PRODUCTIVITY GROWTH LABOR REALLOCATION LABOR REGULATION LABOR REGULATIONS LABOR RELATIONS LABOR SUPPLY LABOR TURNOVER LABOUR LABOUR DEMAND LABOUR LAWS LABOUR MARKET LABOUR MARKET INSTITUTIONS LABOUR MARKET PERFORMANCE LABOUR MARKET POLICIES LABOUR MARKET REFORM LABOUR MARKET REFORMS LABOUR MARKET REGULATION LABOUR REALLOCATION LABOUR REGULATION LABOUR STUDIES LAYOFFS LEARNING LITERATURE LIVING STANDARDS LOW UNEMPLOYMENT LOW-WAGE EMPLOYMENT MARKET DEVELOPMENTS MARKET DISTORTIONS MARKET FAILURES MARKET INTEGRATION MARKET POWER MARKET WAGES MIGRATION MINIMUM WAGE MINIMUM WAGES MOTIVATION MULTIFACTOR PRODUCTIVITY MULTIFACTOR PRODUCTIVITY GROWTH MUNICIPALITIES OCCUPATION OPEN ACCESS PAPERS PENALTIES PERMANENT EMPLOYMENT PERMANENT JOBS PERMANENT WORKER PERMANENT WORKERS POLITICAL ECONOMY POLITICAL PROCESS PRODUCTIVITY EFFECT PRODUCTIVITY EFFECTS PRODUCTIVITY GROWTH PRODUCTIVITY LEVELS PUBLIC FINANCE PUBLIC POLICY REGULAR CONTRACTS REGULAR WORKERS REGULATORY FRAMEWORK RESEARCH FINDINGS RESEARCH INSTITUTE RESEARCH METHODS RESEARCHERS RISK MANAGEMENT SEVERANCE PAYMENTS SOCIAL COHESION SOCIAL RESPONSIBILITY STRUCTURAL ADJUSTMENT SUBSTITUTION SUBSTITUTION EFFECT TAX ADMINISTRATION TEMPORARY EMPLOYMENT TOTAL FACTOR PRODUCTIVITY TRADE UNIONS TRAINING COSTS TRANSACTION COSTS UNEMPLOYMENT UNEMPLOYMENT INSURANCE UNEMPLOYMENT RATE UNION DENSITY UNSKILLED LABOR UNSKILLED WORKERS WAGE BILL WAGE COMPRESSION WAGE DIFFERENTIALS WAGE DISPERSION WAGE DISTRIBUTION WAGE EFFECT WAGE EFFECTS WAGE FLOOR WAGE GAINS WAGE INCREASE WAGE INCREASES WAGE INEQUALITY WAGE POLICIES WAGE POLICY WAGE SET WORKER WORKERS WORKING CONDITIONS Labor market regulation is a high-profile, and often contentious, area of public policy. Although these regulations have been studied most extensively in developed countries, there is a growing body of literature on their effects in developing countries. This paper reviews that literature and focuses on the impacts of two important types of labor market regulation, minimum wages and employment protection legislation (EPL), on employment, earnings, and productivity. Strong and opposing views exist regarding the costs and benefits of these regulations, but the results of this review suggest that their impacts are generally smaller than the heat of the debates would suggest. Efficiency effects are found sometimes, but not always, and the effects can be in either direction and are usually modest. The distributional impacts of both minimum wage and employment protection legislation are clearer, with two effects predominating: an equalizing effect among covered workers, but with groups such as youth, women, and the less skilled disproportionately outside the coverage and its benefits. Although the overall conclusion is one of modest effects in most cases, the policy implication is not that these regulations do not matter. On the one hand, both minimum wages and EPL can affect distributional objectives. On the other hand, these regulations can generate undesirable economic or social impacts if they are established or operate in ways that exacerbate the labor market imperfections that they were designed to address. 2014-04-10T20:17:42Z 2014-04-10T20:17:42Z 2014-03 http://documents.worldbank.org/curated/en/2014/03/19303517/labor-market-regulations-know-impacts-developing-countries http://hdl.handle.net/10986/17732 English en_US Policy Research Working Paper;No. 6819 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank, Washington, DC Publications & Research :: Policy Research Working Paper Publications & Research