labor frictions. Under standard assumptions, theory always implies a motononic negative link between capital-labor ratios …Employment protection (EPL) has a well known negative impact on labor flows as well as an ambiguous but often negative … effect on employment. In contrast, its impact on capital accumulation and capital-labor ratio is less well understood. The …

differences in labor mobility and reallocation costs, which are typically ignored in American "International Trade" textbooks … human capital investments: they are not independent of the aggregate state of labor markets, and in particular, frictions … and slackness of the labor market raises the returns to specific human capital investments relative to general capital …

Labor market frictions are not the only possible factor responsible for high unemployment. Credit market imperfections …. This paper shows that labor and credit market imperfections interact in a complementary way - which may explain why … European and US unemployment differ so much when labor markets have become more similar at the margin in Europe and the US. To …