There is little cross-country comparative evidence on the way labour market institutions shape gross
job and worker flows, by and large because comparable data for many countries are scarce. By using a
unique harmonised dataset on hirings and separations at the industry-level for a large majority of OECD
countries, we fill this gap, by analysing the role of a number of labour and product market institutions in
shaping cross-country differences in gross worker flows. In order to identify the effect of policies and
institutions we consider an industry-level difference-in-difference approach. The basic premise of this
approach is that the effect of a particular policy on gross job flows is greater in industries where the policy
is more likely to constrain firm behaviour. We check, however, the robustness of our results using more
standard cross-country/time-series estimates. The richness of the data available to us allows estimating the
impact of the institutions also on the transitions from job to job, the transitions from job to nonemployment
and the transitions from non-employment to jobs. We find that cross-country differences in
job protection for open-ended contracts and unemployment benefits can explain a large share of crosscountry
variation in gross worker flows. However, the effect of the former is essentially limited to job-tojob
flows.
Institutional Determinants of Worker Flows
A Cross-Country/Cross-Industry Approach
Working paper
OECD Social, Employment and Migration Working Papers
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Abstract
In the same series
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Working paper27 September 2024
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11 March 2024