A Simulation of the Impact of Labor Market Regulations in Central and Eastern Europe
The model we have built takes into consideration the particular features of labor markets in transitional economies. It considers the differences between a state sector and a private sector where employment decisions are made differently. In the former sector employment and wages are the outcome of a bargaining process between owners and workers, whereas in the latter sector competitive cum minimum wage laws set a limit on employment. A simulation allows us to evaluate the impact of various labor market institutions (minimum wages, unemployment benefits and workers’ bargaining power), not only on economic efficiency but also on “equity”.
FOURÇANS, A. et VRANCEANU, R. (1996). A Simulation of the Impact of Labor Market Regulations in Central and Eastern Europe. Dans: Papers and Proceedings. Academy of Economics and Finance (AEF), pp. 185-194.