Oslo Summer School in Comparative Social Science Studies 1998

The Political Economy of European Labour Market Institutions

Main Discipline: Economics
Lecturer: Dr. Gilles Saint-Paul
Institution: Universitat Pompeu Fabra, Barcelona, Spain
Dates: August 3rd - 7th 1998

The current debate over European unemployment has been dominated by a so-called «OECD» view that labour market rigidities are the key culprit for its high level and persistence. But governments that attempted to follow the OECD?s prescription of removing rigidities have often faced harsh political opposition, as was the case with the French government in the spring of 1994.

The aim of the course is to understand why labour market institutions such as those we know in continental Europe ? more specifically, employment protection, unemployment benefits, and relative wage rigidities ? exist, what role they play in society, why they seem so persistent, where the pressure to reform them come from, and whether reform can be politically viable or not. Remedies for unemployment often advocated by economists face considerable political opposition and consequently, labour market reform is often very gradual and marginal, carefully designed not to harm powerful interest groups.

Basic Readings

The lecturer
Gilles Saint-Paul is Professor of economics, Universitat de Pompeu Fabra, Barcelona, and a fellow at the Center for Economic Policy Research, London. He was educated at Ecole Polytechnique, D.E.A. Université de Paris-IX and MIT, where he received his PhD in 1990. He was a Visiting Associate Professor at MIT in 1995. His main fields of specialisation is macroeconomics and labour market economics. He has published academic papers in American Economic Review, European Economic Review, Economic Policy, Quarterly Journal of Economics and in other economic journals. His book Dual labor markets. A macroeconomics perspective was published by the MIT Press in 1997, and he also contributed to D. Blanchflower et. al., Some Reflections on Swedish Labour Market Policy, Stockholm 1995, and G. Alogosjoufis, et. al., Unemployment: Choices for Europe, CEPR, London 1995.