Type
Article
Title
Family Values and the Regulation of Labor
Author(s)
ALESINA Alberto - Department of Economics (Author)
ALGAN Yann - Département d'économie (Author)
CAHUC Pierre - École polytechnique (X) (Author)
GIULIANO Paola - Anderson School of Management - Global Economics and Management (Author)
Editor
GB : MIT Press
Volume
Forthcoming in print
Notes
NBER Working Paper Series - number 15747
ISSN
15424766
DOI
10.1111/jeea.12121
Keywords
Regulation of labor, Family values, Labor market, Market regulation
Abstract
EN
To be efficient, flexible labor markets require geographically mobile workers. Otherwise firms can take advantage of workers' immobility and extract rents at their expense. In cultures with strong family ties, moving away from home is costly. Thus, to limit the rents of firms and to avoid moving, individuals with strong family ties rationally choose regulated labor markets, even though regulation generates higher unemployment and lower incomes. Empirically, we find that individuals who inherit stronger family ties are less mobile, have lower wages and higher unemployment, and support more stringent labor market regulations. We find a positive association between labor market rigidities at the beginning of the 21st century and family values prevailing before World War II, and between family structures in the Middle Ages and current desire for labor market regulation. Both results suggest that labor market regulations have deep cultural roots.
BIBLIOGRAPHIC QUOTE
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