OECD Economics Department Working Papers

Working papers from the Economics Department of the OECD that cover the full range of the Department’s work including the economic situation, policy analysis and projections; fiscal policy, public expenditure and taxation; and structural issues including ageing, growth and productivity, migration, environment, human capital, housing, trade and investment, labour markets, regulatory reform, competition, health, and other issues.

The views expressed in these papers are those of the author(s) and do not necessarily reflect those of the OECD or of the governments of its member countries.

English, French

The macroeconomic impact of structural policies on labour market outcomes in OECD countries

A reassessment

This paper presents a first set of updates and extensions of the large body of existing evidence about the aggregate labour market impact of structural policies, in the context of enhancing the OECD’s supply-side framework for the quantification of reform packages. In line with previous findings, elements of the tax benefit system, activation policies and wage setting institutions are found to be robust policy determinants of the aggregate employment and unemployment rates. Looking beyond the overall employment impact, outcomes for vulnerable groups such as the low educated, the youth and the elderly tend to be more affected by certain structural policies, including specific measures targeted at them. Finally, more competition-friendly product market regulations are also found to impact aggregate employment rates positively and significantly, although less robustly.


Keywords: employment, labour market policies, labour force, unemployment
JEL: E24: Macroeconomics and Monetary Economics / Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy / Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity; J08: Labor and Demographic Economics / General / Labor Economics Policies
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