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Sectoral Structure and Entry Regulations

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  • Messina, Julian

    (European Central Bank)

Abstract

The sectoral allocation of labor differs considerably across developed economies, even in the presence of similar patterns of structural change. A general equilibrium model that captures the stylized facts of structural change is presented. In this framework, economy-wide barriers to entry hinder the development of dynamic sectors such as service industries. Moreover, higher service prices and rents in regulated economies reduce labor supply, providing a rationale for the negative association between product market regulations and the employment rate previously found in the literature. Empirical evidence presented shows that regulatory entry barriers help explaining differences in the sectoral allocation of labor across OECD countries.

Suggested Citation

  • Messina, Julian, 2003. "Sectoral Structure and Entry Regulations," Royal Economic Society Annual Conference 2003 154, Royal Economic Society.
    • Handle: RePEc:ecj:ac2003:154
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    Cited by:

    1. Adriana D. Kugler & Giovanni Pica, 2006. "The Effects of Employment Protection and Product Market Regulations on the Italian Labour Market," Chapters, in: Julián Messina & Claudio Michelacci & Jarkko Turunen & Gylfi Zoega (ed.), Labour Market Adjustments in Europe, chapter 4, Edward Elgar Publishing.
    2. Kugler, Adriana & Pica, Giovanni, 2003. "The effects of employment protection and product market regulations on the Italian labor market," Discussion Paper Series In Economics And Econometrics 0310, Economics Division, School of Social Sciences, University of Southampton.

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    More about this item

    Keywords

    unbalanced growth; entry regulations;

    JEL classification:

    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O41 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models
    • L5 - Industrial Organization - - Regulation and Industrial Policy

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