Labor Market Regulations and the Demand for Labor in Brazil

IPEA Working Paper No. 656

99 Pages Posted: 30 Mar 2000

See all articles by Ricardo Paes de Barros

Ricardo Paes de Barros

Institute of Applied Economic Research (IPEA)

Carlos Henrique Leite Corseuil

Institute of Applied Economic Research (IPEA)

Gustavo M. Gonzaga

Pontifical Catholic University of Rio de Janeiro (PUC-Rio) - Department of Economics

Date Written: July 1999

Abstract

The main objective of this study is to evaluate the impact of the 1988 changes in labor market regulations on the level of employment and on the time required by firms to adjust their employment level to economic fluctuations. From the many aspects of labor market regulations, this study will concentrate on those that directly influence variable labor and dismissal costs. Evaluating the impact of changes in these costs on the level of employment and speed of adjustment will be based on estimates of structural dynamic models for labor demand at different points in time before and after the 1988 constitutional change. The empirical strategy will be to estimate such models from micro-longitudinal monthly data for a sample of 5,000 on manufacturing establishments, which cover the period from January 1985 to December 1997.

To try to isolate the effect of the constitutional change on the parameters of the demand function from the effect of the process of trade liberalization and of the series of stabilization plans that also occurred in the end of the 80's, we regress our monthly estimates of these parameters on a temporal indicator for the 1988 constitutional change, controlling for a variety of other macroeconomic indicators.

JEL Classification: J23, J32

Suggested Citation

Paes de Barros, Ricardo and Leite Corseuil, Carlos Henrique and Gonzaga, Gustavo M., Labor Market Regulations and the Demand for Labor in Brazil (July 1999). IPEA Working Paper No. 656, Available at SSRN: https://ssrn.com/abstract=193650 or http://dx.doi.org/10.2139/ssrn.193650

Ricardo Paes de Barros

Institute of Applied Economic Research (IPEA) ( email )

Av. Presidente Antonio Carlos 51
DISOC - Directory of Social Research and Policy 10. andar
RJ 20020-010 Rio de Janeiro
Brazil
+55 21 804 8155 (Phone)
+55 21 240 1920 (Fax)

Carlos Henrique Leite Corseuil (Contact Author)

Institute of Applied Economic Research (IPEA) ( email )

Av. Presidente Antonio Carlos 51
14 andar, Castelo
RJ 20020-010 Rio de Janeiro
Brazil
+55 21 3804-8000 (Phone)
+55 21 2240-1920 (Fax)

Gustavo M. Gonzaga

Pontifical Catholic University of Rio de Janeiro (PUC-Rio) - Department of Economics ( email )

Rua Marques de Sao Vicente, 225/206F
Rio de Janeiro, RJ 22453
Brazil
+55 21 274 2797 (Phone)
+55 21 294 2095 (Fax)

HOME PAGE: http://www.econ.puc-rio.br/Gonzaga/Pdf/cv_us_last_version.pdf

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