ECONOMIC GROWTH CENTER
                                
                        YALE UNIVERSITY
                                
                                
                        P.O. Box 208269
               New Haven, Connecticut 06520-8269
                                
                                
                                
                                
                CENTER DISCUSSION PAPER NO. 802
                                
                                
                                
                                
      LABOR MARKET REFORMS: ISSUES, EVIDENCE AND PROSPECTS
                                
                                
                                
                                
                                
                                
                        T. Paul Schultz
                        Yale University
                                
                                
                                
                                
                           June 1999

     




 Note:    Center Discussion Papers are preliminary materials circulated to stimulate discussions and
          critical comments.
      






Labor Market Reforms

                                                     June 1, 1999
                                                          Revision
                                                                 





LABOR MARKET REFORMS: ISSUES, EVIDENCE, AND PROSPECTS
T. Paul Schultz


Abstract

The study of labor market segmentation and the estimation of the deadweight loss due to policy
distortions reflected in wage structures require analyses of labor force surveys. These data are
increasingly available in most countries. But evaluations of labor market reforms are uncommon.
The lack of documented labor market reforms may reflect the difficulty of reducing wage distortions
by direct policy measures, and the greater capacity of trade reforms and changes in industrial
structure to erode wage distortions indirectly, and thereby promote efficiency and economic growth.
The economic case for labor market reforms should nonetheless strengthen support for allied
policies.