Flanding, Jens
(2016)
European labour market flexibility reforms: a longitudinal study of change and continuity.
PhD thesis, London School of Economics and Political Science.
Abstract
Debate about European labour market flexibility enhancing reforms and lack thereof has a tendency to be dominated by economics arguments. This thesis advances the debate by going beyond the economics arguments to ask the political science question: what explains the political ability (or inability) to enact flexibility enhancing reforms in European countries from the early 1980s to the global recession of 2008? Answering the question, this thesis argues that the ability to enact reforms is best explained by a combination of traditional political-economy pressures for reforms and political-electoral motivations of party leaders in government.
The argument is supported by a longitudinal analysis of European and country specific reforms using mixed-methods – i.e. quantitative and qualitative research – and employment protection legislation (EPL) as a proxy for reforms, the latter being warranted because of EPLs political salience as a reform target prior to 2008. First, a quantitative cross-country reform-hazard analysis arrives at significant economic and political explanations for reforms, which include a country’s social model, unemployment rate and economic growth. Then, a qualitative analysis of the trajectory of EPL and functionally linked labour market reforms combines the quantitative results with a broader political understanding of reforms for Germany, the UK and Denmark as country cases where reforms were enacted, and France as a case where only limited or contradictory EPL reforms were put in place during the period covered by this thesis.
The thesis adds robustness to the literature showing most pre-2008 global recession reforms were at the margin, targeting non-regular employment parts of European labour markets. However, overall, the thesis provides a political understanding of the European reform trajectory, suggesting that economic arguments rarely on their own stand up as determinants of reforms. The implications for future research are that the enactment of flexibility enhancing reforms should be treated more explicitly as the outcomes of political decisions and less as reactive steps to economic predictions or political economy pressures for reforms, even if the latter continues to play a role in bringing reforms onto the political agenda.
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