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How comparable are labor demand elasticities across countries?

by Pablo Fajnzylber

Labor demandElasticity (Economics)Labor marketLabor supply

Even accounting for the large variance induced by different estimation techniques, one probably cannot say much about the flexibility of different labor markets based on comparisons of the estimated elasticity of demand. Colombia, for example, which has severe restrictions on firing workers, has much higher long-run wage elasticities than Chile, which has no such restrictions.

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For young readers

Book data: Open Library