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The impact of labour market regulation on the unemployment rate: Evidence from OECD economies

Main content area
Research Paper 3/2017
Publication Date: 
April 2017

This staff research paper investigates the relationship between labour market regulation and the unemployment rate.

The results indicate that increasing the flexibility of labour market regulation via reforms can result in reductions in the unemployment rate. This average effect across all OECD member countries, however, is relatively small. Younger labour market participants (15-24 years), have more to gain in terms of employment opportunities as a result of flexibility enhancing labour market regulation reforms.

Author: Bilal Rafi

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