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Alesina, A., Algann, Y. Cahuc, P., Giuliano, P. (2010). Family Values and the Regulation of Labor. Harvard University Department of Economics, mimeo

Flexible labor markets require geographically mobile workers to be e¢ cient. Otherwise, …rms can take advantage of the immobility of workers and extract monopsony rents. In cultures with strong family ties, moving away from home is costly. Thus, individuals with strong family ties rationally choose regulated labor markets to avoid moving and limiting the monopsony power of …rms, even though regulation generates lower employment and income. Empirically, we do …nd that individuals who inherit stronger family ties are less mobile, have lower wages, are less often employed and support more stringent labor market regulations. There are also positive cross-country correlations between the strength of family ties and labor market rigidities. Finally, we …nd positive correlations between labor market rigidities at the beginning of the twenty …rst century and family values prevailing before World War II, which suggests that labor market regulations have deep cultural roots.

Authors

Alesina, Alberto

Alberto Alesina, born in Italy in 1957, is the Nathaniel Ropes Professor of Political Economy at Harvard University. He served as Chairman of the Department of Economics from 2003 - 2006. He obtained his Ph.D. from Harvard in 1986. He is also a member of the National Bureau of Economic Research...

Algan, Yann

Yann Algan is Professor of Economics at Sciences Po Paris. He is affiliated to CEPR, IZA and CEPREMAP (Co-head Macroeconomic program). Awards and grants European Starting Grant (ERC) 2010-2014 - Project "Trust" Best French Young Economist 2009 Best French economic book and...

Cahuc, Pierre

Pierre Cahuc is Professor of Economics Ecole Polytechnique and Research fellow CREST-INSEE, IZA,CEPR Selected publications Is short-time work a good method to keep unemployment down? with Stéphane Carcillo, forthcoming in the Nordic Economic Policy Review Civil Society and...

Giuliano, Paola

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