In Defence of Labour Market Institutions: Cultivating Justice in the Developing World

by Janine Berg, David Kucera

Overview

Labour market institutions have been blamed for the poor economic performance of many developing countries. Based on theoretical and empirical evidence, an interdisciplinary group of researchers demonstrate that the evidence on which this argument rests is weak. The volume provides an understanding of why formal labour market regulations and policies were implemented in developing countries and how informal values and norms also influence the workings of the labour market. It also analyses the economic effect that these institutions can have while shedding light on conceptual and methodological questions that have plagued the debate.

This volume counters the prevailing view that labour market institutions are equated with labour market rigidity, and offers economic and social reasons for maintaining certain policies and standards, differentiating between the needs and challenges of countries with varying levels of income.

Product Details

ISBN-13:	9780230267213
Publisher:	Palgrave Macmillan
Publication date:	02/22/2008
Sold by:	Barnes & Noble
Format:	eBook
File size:	2 MB

About the Author

Janine Berg is a labor economist with the International Labor Office (ILO). David Kucera is a labor economist with the ILO.

Table of Contents

List of Tables and Figures     xi
Acknowledgements     xiii
Notes on Contributors     xv
Introduction   Janine Berg   David Kucera     1
The labour market flexibility debate     1
Overview of the chapters     3
Labour Institutions in the Developing World: Historical and Theoretical Perspectives   Janine Berg   David Kucera     9
Introduction     9
What are labour institutions?     11
History of labour standards and the ILO     15
International labour standards: Are they relevant?     19
The debate on labour market flexibility     22
Conclusion     27
Measuring Labour Market Institutions: Conceptual and Methodological Questions on 'Working Hours Rigidity'   Sangheon Lee   Deirdre McCann     32
Introduction     32
A review of the indicators     34
Methodological and conceptual questions on measuring working time 'rigidity'     37
Legal texts and actual hours: de jure and de facto regulation     45
Concluding remarks     58
Institutions and the Finance of General Skills Training: Evidence from Africa   Irmgard Nubler     64
Introduction     64
Strategic decision of firm and worker: a trust game     65
Evidence from Africa     70
Conclusions     75
The Origins of Unemployment Insurance: Lessons for Developing Countries   Janine Berg   Matthew Salerno     80
Introduction     80
The different ways of compensating unemployment     81
The origins of unemployment insurance     83
Is unemployment insurance suitable for developing countries?     91
Is unemployment insurance the right approach?     95
Conclusions     97
The Revival of Minimum Wage Setting Institutions   Francois Eyraud   Catherine Saget     100
Introduction     100
Minimum wage setting institutions     101
The minimum wage and collective bargaining     102
The minimum wage and poverty     106
Workers with no form of wage protection     108
The minimum wage and wage inequality     111
The minimum wage and employment     112
Conclusion     116
What Can the Labour Demand Function Tell Us About Wages and Employment? The Case of the Philippines   Jesus Felipe   J.S.L. McCombie      119
Introduction     119
Derivation of the elasticity of demand for labour     123
A more parsimonious interpretation     125
Do minimum wages cause unemployment in the Philippines?     128
The Philippine labour demand function     134
Do increases in the minimum wage rate induce increases in the average wage rate in the Philippines?     137
Conclusions     138
The Impact of Trade Unions: What Do Economists Say?   Zafiris Tzannatos     150
Introduction     150
You need three to tango: workers, employers and governments     151
Empirical evidence: microeconomic     159
Empirical evidence: macroeconomic     171
Summary and conclusions     179
Labour Standards and Informal Employment in Latin America   Rossana Galli   David Kucera     192
Introduction     192
Prior empirical evidence for Latin America     196
Employment data definitions, sources and overview     198
Labour standards and formal and informal employment     200
Concluding remarks     212
Legal Determinants of Labour Informality   Jose Luis Daza Perez     218
Introduction     218
Concepts and definitions on informality at work     219
The legal framework of labour: the reality of the scope of labour law regarding inclusions, exclusions and exemptions     223
Attitude of states towards informality     228
Conclusion: policies to incorporate workers and informal activities into the formal economy     231
New Trends in Latin American Labour Reforms: The Law, its Reform and its Impact in Practical Terms   Maria Luz Vega Ruiz     233
Introduction     233
Main amendments to labour relations     239
Main amendments to collective labour relations     251
Conclusions     256
Bibliography     264
Index     283

Editorial Reviews

'This is a timely volume on a critically important topic. Berg and Kucera and their contributors challenge the conventional wisdom that excessive labor market regulation retards growth and development, and that developing countries in particular can ill afford the level of such regulation that they have taken on. Taken as a whole, the papers make a compelling case for skepticism about this conventional wisdom. The volume provides a vital survey of the state of regulatory institutions in the developing world and the main empirical, theoretical, and normative arguments about the alleged regulation/growth tradeoff.' - Professor Chris Tilly, Department of Regional Economic and Social Development and Center for Industrial Competitiveness, University of Massachusetts Lowell

From the Publisher