In recent years several models have been developed in an attempt to explain countercyclical movements of job turnover, the sum of gross job creation and destruction rates. However, only in the United States is a negative and statistically significant correlation between job turnover and employment growth actually observed. In the other countries studied, job turnover is either acyclical or mildly procyclical. Rather than being associated with the greater flexibility of the United States compared with the Western European labor markets, these asymmetries in the cyclical behavior of gross job flows can be attributed to statistical artifacts, namely, with the fact that U.S. job turnover statistics underrepresent the small business sector and with regression to the mean effects.

Temporary employment has spiked in OECD countries over the last 40 years and is now a common feature of their labor market landscape. A large body of empirical literature examines the spread of temporary employment, but no systematic review and interpretation of its findings in light of economic theory exists. This survey aims at filling this gap by interpreting the key empirical results based on the predictions of the macro models in markets with frictions developed to address specific features of temporary employment. Revisions of workhorse models used so far to analyze temporary employment are also suggested. (JEL J22, J31, J41, J81, J83, K31)

New Member States (NMS) coming from central planning are often advised against early Euro adoption because of their rigid labour markets. But are labour markets so rigid in these countries? We argue in this paper that this is not the case. Labour market institutions are no more “rigid” than among current EMU Members whilst wage bargaining institutions are actually better equipped for microeconomic wage flexibility than in the EU-15. NMS also achieved substantial reallocation of jobs and workers in the transition to markets, display relatively large job turnover rates and are reducing their regional mismatch. The view that NMS have rigid labour markets is fuelled by the low job content of growth in the region. But there is evidence that the latter is related to productivity enhancing job destruction in the aftermath of prolonged labour hoarding. Reduced-form employment equations estimated in this paper also suggest that tight fiscal policies, rather than being harmful to job creation, may actually improve the employment performance of the region. Our interpretation of this result is that loose fiscal policies weaken the confidence of investors and crowd-out private employment growth through generous pay rises to civil servants.

This paper sheds light on the difficulties of pension reforms by analyzing the citizens´opinions on different aspects of the welfare state and its redistributive programs. We focus on the pension system, reporting the results of a questionnaire conducted in Germany and Italy in the Fall 2001. Our questionnaire was designed to shed light on the following issues: Are citizens aware of the unsustainability of the pension system and informed of its costs? Are reforms opposed by a majority or by a powerful minority? Which reform options seem politically more feasible and why? Which groups of citizens are more likely to favor reforms? We find that citizens are aware of unsustainability but lack information about the cost of the PAYG system. The status quo is a majoritarian outcome along many dimensions: most reform proposals lack a mojority and there is limited scope of packaging as reformers rarely support more than one reform option. Later retirement is the easier reform in Italy while opting-out of the PAYG system is popular in Germany, but only of accompanied by mandatory savings and with no transition burdan.