Firm-level employment, labour market reforms, and bank distress

Arbeitspapier

We explore the interaction between labour market reforms and financial frictions. 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 long-term employment gains at the firm-level. Entrepreneurs without sufficient access to credit cannot reap the full benefits of more flexible employment regulation.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: IWH Discussion Papers ; No. 15/2019

Classification and Topics

• Classification: Wirtschaft ; Banks; Depository Institutions; Micro Finance Institutions; Mortgages ; Labor Force and Employment, Size, and Structure ; Labor Standards: General ; Labor Law
• Subject: labour market reforms ; bank stress ; employment protection ; unemployment insurance

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Setzer, Ralph ; Stieglitz, Moritz
• Event: Veröffentlichung
• (who): Leibniz-Institut für Wirtschaftsforschung Halle (IWH)
• (where): Halle (Saale)
• (when): 2019

Further information

• Handle: http://hdl.handle.net/10419/200096
• URN: urn:nbn:de:gbv:3:2-109032
• Last update: 10.03.2025, 11:41 AM CET