Firm-level Employment, Labour Market Reforms, and Bank Distress
Journal of International Money and Finance,
We explore the impact of financial frictions on the employment effect of labour market reforms. Our study combines a new cross-country reform database on labour market reforms with matched firm-bank data for nine euro area countries over the period 1999 to 2013. While we find that labour market reforms are overall effective in increasing employment, restricted access to bank credit can undo up to half of medium to long-term employment gains at the firm-level. Entrepreneurs without sufficient access to credit cannot reap the full benefits of more flexible employment regulation.
Transformation tables for administrative borders in Germany
Transformation tables for administrative borders in Germany The state has the ability...
Transformation tables for administrative borders in Germany – data In order to...
Centre for Evidence-based Policy Advice
Centre for Evidence-based Policy Advice (IWH-CEP) ...
Four Research Clusters ...
Brown Bag Seminar
Brown Bag Seminar Financial Markets Department The seminar series "Brown...
Joint Economic Forecast
Joint Economic Forecast The joint economic forecast is an instrument for evaluating...
IWH Alumni The IWH would like to stay in contact with its former employees. We...
Labor in the Boardroom
Quarterly Journal of Economics,
We estimate the wage effects of shared governance, or codetermination, in the form of a mandate of one-third of corporate board seats going to worker representatives. We study a reform in Germany that abruptly abolished this mandate for stock corporations incorporated after August 1994, while it locked the mandate for the slightly older cohorts. Our research design compares firm cohorts incorporated before the reform and after; in a robustness check we draw on the analogous difference in unaffected firm types (LLCs). We find no effects of board-level codetermination on wages and the wage structure, even in firms with particularly flexible wages. The degree of rent sharing and the labor share are also unaffected. We reject that disinvestment could have offset wage effects through the canonical hold-up channel, as shared governance, if anything, increases capital formation.