The Evaluation of Türkiye’s Labour Market Regulations Together with Its Macroeconomic Performance with a Comparison of Some Selected Countries’ Performances

Authors : Ayça Sarıalioğlu Hayali, Djallel Aımar, Mohammad Mansoor Lodın

Pages : 809-829

Doi:10.36362/gumus.1437789

View : 71 | Download : 84

Publication Date : 2024-10-08

Article Type : Research Paper

Abstract :The relationship between labor market regulations and macroeconomic performance is a complex issue in the economics literature. The study evaluates it for Türkiye from 1980–2021 using the original Macroeconomic Performance Index (MPI) and the Labor Market Regulations Index (LMRI). The MPI, measured by the Magic Hypercube (MH) method, incorporates economic growth, current account, inflation, and unemployment. LMRI is a composite index reflecting labor market regulations’ flexibility or rigidity based on seven dimensions such as minimum wage, hiring and firing regulations, flexible wage determination, hour regulations, costs of worker dismissal, conscription, and foreign labor. Overall, it can be said that during 1980–2021, the macroeconomic performance of Türkiye is mostly unrelated to the labor market regulations; namely, it seems that the MPI of Türkiye does not depend on LMRI at all. At least, it can be said that there seem to be no findings confirming the neoclassical view’s expectations; rather, the opposite one seems valid. When a comparison of some selected countries’ performances of MPI and LMRI for the period of 1990-2021 is done similar interpretations were reached at.
Keywords : İşgücü Piyasası Düzenlemeleri, Makroekonomik Performans, Magic Hypercube, Türkiye