At European level, the debate on flexicurity is currently high on the employment and social policy agenda. Member States are reflecting on the best way to adapt their systems to the "new reality" of maintaining the balance between the need for flexibility in the labour market to allow companies...

This paper examines the impact of employment protection legislation on productivity in the OECD, using annual cross-country aggregate data on the degree of regulations and industry-level data on productivity from 1982 to 2003. We adopt a "difference-in-differences" framework, which exploits...