TY  - UNPD
A1  - Topal, Pinar
T1  - Fiscal stimulus and labor market flexibility
T2  - SAFE working paper series ; No. 90
N2  - This paper investigates whether a fiscal stimulus implies a different impact for flexible and rigid labour markets. The analysis is done for 11 advanced OECD economies. Using quarterly data from 1999 to 2013, I estimate a panel threshold structural VAR model in which regime switches are determined by OECD’s employment protection legislation index. My empirical results indicate significant differences between rigid and flexible labour markets regarding the impact of the fiscal stimulus on output and unemployment. While the impulse response of real GDP to a government spending shock is positive and more effective in flexible labour markets, it has less impact in the rigid ones. Moreover, it is found that a fiscal stimulus leads to higher overall unemployment in highly regulated countries.
T3  - SAFE working paper - 90 
KW  - fiscal policy
KW  - labour economics
KW  - labour market policies
KW  - threshold vector auto-regressive models
KW  - panel VAR
KW  - non-linear VAR
KW  - impulse analysis
Y1  - 2015
UR  - http://publikationen.ub.uni-frankfurt.de/frontdoor/index/index/docId/37127
UR  - https://nbn-resolving.org/urn:nbn:de:hebis:30:3-371279
UR  - http://ssrn.com/abstract=2573758
IS  - March 3, 2015
PB  - SAFE
CY  - Frankfurt am Main
ER  -