Abstract

The last few decades have seen the emergence of a large amount of literature examining the links between labor market institutions and macroeconomic outcomes. The interdisciplinary efforts of economists, political scientists and sociologists have given rise to a theoretically lively and methodologically diverse literature. This research attempts to answer a range of important questions. Some are policy related: what can governments do in the face of economic challenges? What defines a state’s capacity to meet such challenges? Others are institutional: do some institutions promote lower rates of inflation and unemployment or higher rates of growth than others? What are the trade-offs? Can we expect technological change and globalization to lead to institutional convergence? And what factors are likely to affect the adjustment of a political economy in the face of such challenges?