2018年-IMF国际货币组织全球_Employment_Protection_Deregulation_and_Labor_Shares_in_Advanced_Economies_72页_1mb

Summary of IMF Working Paper: Employment Protection Deregulation and Labor Shares in Advanced Economies

Core Content

This paper investigates the impact of employment protection legislation (EPL) deregulation on labor shares in 26 advanced economies between 1970 and 2015. It argues that labor market deregulation, particularly job protection reforms, has played a significant role in the observed decline in labor shares, which has been a widespread phenomenon since the early 1990s.

Main Views and Key Findings

• Labor Share Decline: Labor shares have been declining in many advanced economies since the 1980s, with a sharp acceleration in the 1990s. This contradicts the long-standing view in macroeconomics that labor shares are relatively stable over time.

• Deregulation as a Driver: The paper identifies employment protection deregulation as a plausible, yet underexplored, driver of this decline. It suggests that such deregulation has reduced workers' bargaining power, leading to lower wages and, consequently, lower labor shares.

• Empirical Methodology: The authors use a newly constructed dataset of major EPL reforms and apply a local projection method to estimate the dynamic response of labor shares to these reforms. They also use a differences-in-differences approach at the country-industry level, based on two theoretical assumptions:

  • Deregulation has a larger negative impact in industries with a higher "natural" layoff rate.
  • Deregulation has a larger negative impact in industries with lower elasticity of substitution between capital and labor.

• Quantitative Impact: The paper estimates that job protection deregulation may have contributed about 15% to the overall decline in labor shares in advanced economies. This is primarily attributed to the 1990s and 2000s deregulation wave, which coincided with the most pronounced decline in labor shares.

• Robustness of Results: The findings are robust to various controls, including GDP growth, technological progress, and international trade. The authors also test the effects of excluding individual countries and industries, and their results remain consistent.

• Channels of Impact: The decline in labor shares is mainly driven by a reduction in real wages, which is a key channel through which deregulation lowers labor shares. This supports the interpretation that weakened worker bargaining power is central to the observed effects.

Key Information

• Data Sources:

  • EPL Reforms: A narrative dataset of major EPL reforms, compiled from OECD Economic Surveys and country-specific sources.
  • Layoff Rates: Industry-specific layoff rates derived from the 2014 Displaced Workers Survey (DWS) and IPUMS-CPS data.
  • Elasticity of Substitution (EOS): Estimated using firm-level data and a production function model. The average EOS across industries is approximately 0.7, with some industries showing higher or lower substitutability.
  • Labor Shares: Data is sourced from the OECD Analytical Database and the EU KLEMS databases, providing harmonized value added and labor compensation figures.

• Theoretical Framework:

  • The paper draws on two wage bargaining models:
    • Right-to-Manage Model: Where employers set wages and employment, and deregulation reduces workers' bargaining power, leading to lower wages and potentially lower or higher labor shares depending on the elasticity of substitution.
    • Efficient Bargaining Model: Where both wages and employment are negotiated, and deregulation unambiguously lowers labor shares regardless of substitution elasticity.

• Identification Strategy:

  • The authors use a three-dimensional dataset (country, industry, time) to control for unobserved heterogeneity and to mitigate reverse causality concerns.
  • The inclusion of fixed effects (country-time, industry-time, and country-industry) allows for more accurate estimation of the impact of EPL reforms on labor shares.

Stylized Facts

• Labor shares declined significantly in the five years following major EPL reforms.
• The decline was more pronounced in industries with higher layoff rates and lower elasticity of substitution.
• The U.S. is used as a benchmark for a "frictionless" economy due to its minimal EPL.
• The "Electrical & Optical" industry had the highest layoff rate, while "Coke & Refined Petroleum" had the lowest.

Conclusion

• The paper highlights the important role of labor market institutions in shaping labor shares, particularly through the deregulation of employment protection.
• It contributes to the growing body of literature on labor market reforms by providing new empirical evidence that supports the causal link between EPL deregulation and labor share decline.
• The results suggest that policymakers should carefully consider efficiency-equity trade-offs when designing labor market reforms, as deregulation can have significant macroeconomic consequences.

Key Figures and Tables

• Figure 1: Cumulative changes in labor shares around reform years.
• Figure 2: Cumulative changes in industry labor shares by industry.
• Figure 3: Country-level baseline results.
• Figure 4: Country-industry-level baseline results.
• Figure 5 & 6: Robustness checks excluding individual countries and industries.
• Tables:
  • Table 1: Country-level robustness checks.
  • Table 2: Country-industry-level robustness checks on lag specification.
  • Table 3: Country-industry-level robustness checks on sample composition.
  • Table 4: Country-industry-level robustness checks on layoff rates.
  • Table 5: Country-industry-level robustness checks on elasticities of substitution.
  • Table 6: Country-industry-level robustness checks on omitted variables.
  • Table 7: Country-industry-level extension on labor share drivers.
  • Table 8: Country-industry-level extension on sample split according to elasticity of substitution.

Appendixes

• Appendix 1: Dataset of reforms.
• Appendix 2: Layoff rate construction.
• Appendix 3: Elasticity of substitution estimation.
• Appendix 4: Summary statistics and baseline data.

References

• The paper references a range of studies, including:
  • Kaldor (1957, 1961)
  • Karabarbounis and Neiman (2014)
  • Blanchard and Giavazzi (2003)
  • Bentolila and Saint-Paul (2003)
  • Antras (2004)
  • Oberfield and Raval (2014)
  • Lawrence (2015)
  • Duval et al. (2018)

This paper provides a comprehensive and methodologically sound analysis of the relationship between employment protection deregulation and labor shares, offering valuable insights for both academic and policy discussions.