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SPP 1169:  Flexibility in Heterogeneous Labour Markets

Subject Area Social and Behavioural Sciences
Term from 2004 to 2010
Project identifier Deutsche Forschungsgemeinschaft (DFG) - Project number 5472104
 
For a long time, a public discussion on the lack of flexibility of the German labour market and persistently high unemployment has persisted. The multifaceted modifications of the general framework have caused very different reactions on the supply and demand side of the labour market and also within labour force groups and firms. Consequently, the heterogeneity of labour market conditions concerning the skill structure of labour, professions, firms, industries and regions is growing. Problems of inflexibility that hamper and inhibit the adjustment across sub-segments are evident. These observations lead to new challenges, since the greater and more frequently emerging rigidities of the labour market have to be met in a sophisticated way.
The prior objective of the Priority Programme is to reveal capabilities for more flexibility as well as to figure out the relations between different dimensions of heterogeneous labour markets and their flexibility. Making labour markets more flexible means to create conditions in such a way as to enable the economy to respond faster and more efficiently to new developments and challenges.
The central research idea is to be: Historically grown institutions have produced rigidities, particularly in the labour market, which have an impact on the adjustment of the labour force (in persons and hours), of wage compensation and of the skill level of employees. Adjustments will typically occur where restraints are lowest. This Priority Programme will, on the base of economic, business- and social-economic analysis, investigate the labour market theoretically and empirically (using econometrics and experiments) to gain new insights.
DFG Programme Priority Programmes
International Connection Switzerland, United Kingdom, USA

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