Government expenditure on labour market policies in OECD countries: responding to the economic crisis

an article by Hyungjo Hur (The Ohio State University, Columbus, USA) published in Policy Studies Volume 40 Issue 6 (2019)

Abstract

In most Organization for Economic Cooperation and Development (OECD) countries, the unemployment rate increased considerably during the early stage of the Great Recession of 2008. However, unemployment trends varied by country: some countries were more resilient, resulting in a faster recovery and lower or steady unemployment rates during the recession.

This study evaluates the impact of different government expenditures on labour market policies (especially active labour market policies) among OECD unemployment rates.

Based on panel regression and a difference-in-difference analysis utilizing panel data from 2001 to 2013, this study discusses how government active labour market policies have worked to reduce the unemployment rate, and how this policy helps resilient countries to adapt to unexpected economic crises.

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