Many arguments that have been advanced in favor of maintaining capital controls within the EC have not paid sufficient attention to the welfare consequences of this type of market intervention. Our paper provides a simple, optimizing framework in which the welfare consequences of capital...

In designing policy measures, including possible social safety nets, targeted to the poor, it is important to fully understand the efficiency implications of these measures. There is abundant macroeconomic literature on their negative effects on the poor’s work effort. The literature, however,...

We provide a framework for analyzing the choice between optimal and robust monetary policy rules in the presence of paradigm uncertainty. We first discuss the conditions on uncertainty that render a robust rule preferable to an optimal rule. Second, we show how the degree of risk aversion of the...

This paper reviews several methods to measure wage flexibility, and their suitability for evaluating the extent of such flexibility during times of structural change, when wage distributions and wage curves can be particularly volatile. The paper uses nonparametric estimation to capture possible...

The paper examines labor market developments in the four hard-peg European Union (EU) accession candidates during transition, with a view toward understanding the persistent high unemployment experienced in each country. Despite the significant levels of unemployment in all four countries, labor...

This Selected Issues paper analyzes the regional labor markets for Belgium. The paper examines labor market performance, and argues that a number of factors—poor worker-job matching, a compressed wage structure, and low geographical mobility—contribute to economic disparities. The paper...

The IMF Working Papers series is designed to make IMF staff research available to a wide audience. Almost 300 Working Papers are released each year, covering a wide range of theoretical and analytical topics, including balance of payments, monetary and fiscal issues, global liquidity, and...

The GCC growth model has delivered substantial improvements in living standards over several decades. Access to foreign labor has supported rapid growth in the non-oil sector and price stability in the region. It has also resulted in positive spillovers to the migrant-sending countries through...

The growth rate of real hourly wages in France has fallen below the trend growth rate of total factor productivity. The distribution of wage and earnings growth has not been uniform across deciles. A breakdown in employment growth by wage deciles also suggests important composition changes. The...