References of "Pierrard, Olivier"
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See detailStructural changes in the labor market and the rise of early retirement in France and Germany
Batyra, Anna; de la Croix, David; Pierrard, Olivier et al

in German Economic Review (in press)

The rise of early retirement in Europe is typically attributed to the European system of taxes and transfers. A model with an imperfectly competitive labor market allows us to consider also the effects of ... [more ▼]

The rise of early retirement in Europe is typically attributed to the European system of taxes and transfers. A model with an imperfectly competitive labor market allows us to consider also the effects of bargaining power and of matching efficiency on pre-retirement. We find that lower bargaining power of workers and declining matching efficiency have been important determinants of early retirement in France and Germany. These structural changes, combined with early-retirement transfers and population aging, are also consistent with the employment and unemployment rates, labor share and seniority premia. [less ▲]

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See detailThe EU-US Unemployment Puzzle Revisited: Institutions, Demography, and Capital Flows
Marchiori, Luca; Pierrard, Olivier; Sneessens, Henri UL

in Journal of Demographic Economics (2017)

The historical evolution of the EU-US unemployment rate gap is often explained in the literature in terms of asymmetric changes in labour market institutions. Population aging is another potential source ... [more ▼]

The historical evolution of the EU-US unemployment rate gap is often explained in the literature in terms of asymmetric changes in labour market institutions. Population aging is another potential source of asymmetry. Asymmetric population aging may generate international capital flows and have a substantial impact on relative unemployment rates. In this paper, we examine whether the combination of institutions, aging and capital flows explains the rise in the gap between 1960 and 2010. To this end, we set up a two-region overlapping generation model with search unemployment in which we introduce the historical and projected changes in labour market institutions and demographic evolutions. We show that asymmetric institutional changes alone can reproduce a large part of the historical rise in the unemployment gap. However, this result does not hold anymore once we add asymmetric aging in closed economies. We are nevertheless able to restore and even improve the initial result when we allow for international capital mobility. [less ▲]

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See detailSovereign debt default and banking in a currency union
Perego, Erica UL; Pierrard, Olivier

Scientific Conference (2014, May 27)

This paper analyzes the role of banking in the transmission of sovereign debt default within a currency union. We build a 2-country (core and periphery) new-Keynesian model with an endogenous possibility ... [more ▼]

This paper analyzes the role of banking in the transmission of sovereign debt default within a currency union. We build a 2-country (core and periphery) new-Keynesian model with an endogenous possibility of default on the periphery public debt. We introduce alternative banking representations, going from full integration to fragmentation. We calibrate the model on euro area data and show that the best fit to empirical data arises when we introduce some degree of fragmentation. However, we observe that a well integrated banking sector would reduce the negative consequences of default at the EA aggregated level and limit the welfare cost of stabilizing policies. [less ▲]

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See detailAging and Pensions in General Equilibrium: Labour Market Imperfections Matter
de la Croix, David; Pierrard, Olivier; Sneessens, Henri UL

in Journal of Economic Dynamics & Control (2013), 37

We re-examine the effects of population aging and pension reforms in an OLG model with labor market frictions. The most important feature brought about by labor market frictions is the connection between ... [more ▼]

We re-examine the effects of population aging and pension reforms in an OLG model with labor market frictions. The most important feature brought about by labor market frictions is the connection between the interest rate and the unemployment rate. Exogenous shocks (such as aging) leading to lower interest rates also imply lower equilibrium unemployment rates, because lower capital costs stimulate labor demand and induce firms to advertise more vacancies. These effects may be reinforced by increases in the participation rate of older workers, induced by the higher wage rates and the larger probability of finding a job. These results imply that neglecting labor market frictions and employment rate dynamics may seriously bias the evaluation of pension reforms when they have an impact on the equilibrium interest rate. [less ▲]

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See detailDeclining bargaining power of workers and the rise of early retirement in Europe
Batyra, Anna; de la Croix, David; Pierrard, Olivier et al

E-print/Working paper (2013)

We offer an alternative explanation for the decline in labor force participation of senior workers. Typically, tax and transfer explanations have been proposed. On the contrary, a model with imperfectly ... [more ▼]

We offer an alternative explanation for the decline in labor force participation of senior workers. Typically, tax and transfer explanations have been proposed. On the contrary, a model with imperfectly competitive labor market allows to consider as well the effects of a drop in bargaining power, which would not be possible in a purely neoclassical framework. We find that a decline in the bargaining power of workers, which has taken place in the last four decades, has largely contributed to the rise in inactivity in Europe. However, we need a combination of these two explanations, along with population aging and a fall in the matching efficiency, in order to correctly reproduce the joint evolutions of other labor market variables such as the employment and unemployment rates. [less ▲]

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See detailSequential bargaining in a New Keynesian model with frictional unemployment and staggered wage negotiation
De Walque, Gregory; Pierrard, Olivier; Sneessens, Henri UL et al

in Annales d'Economie et de Statistique (2009), 95-96

We consider a model with frictional unemployment and staggered wage bargaining where hours worked are negotiated every period. The workers’ bargaining power in the hours negotiation affects both ... [more ▼]

We consider a model with frictional unemployment and staggered wage bargaining where hours worked are negotiated every period. The workers’ bargaining power in the hours negotiation affects both unemployment volatility and inflation persistence. The closer to zero this parameter, (i) the more firms adjust on the intensive margin, reducing employment volatility, (ii) the lower the effective workers’ bargaining power for wages and (iii) the more important the hourly wage in the marginal cost determination. This set-up produces realistic labor market statistics together with inflation persistence. Distinguishing the probability to bargain the wage of the existing and the new jobs, we show that the intensive margin helps reduce the new entrants wage rigidity required to match observed unemployment volatility. [less ▲]

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See detailBiased Technological Shocks, Relative Wage Rigidities and Low-Skilled Unemployment
Sneessens, Henri UL; Pierrard, Olivier

in Scottish Journal of Political Economy (2008), 55(3), 330-352

The contrast between the evolution over the last decades of the European Union (EU) and the US unemployment rates, especially for the low-skilled, is well known. A consensus view is that these different ... [more ▼]

The contrast between the evolution over the last decades of the European Union (EU) and the US unemployment rates, especially for the low-skilled, is well known. A consensus view is that these different outcomes can be explained by the interactions between common shocks and specific institutional setups. In this paper, we emphasize the interactions between technological changes and wages rigidities. We construct a fully calibrated general equilibrium model with two types of jobs and two types of workers, and with search unemployment. Our simulations show that with wage rigidities, technological changes suffice to generate a continuous rise in the low-skilled unemployment rate and an almost unchanged high-skilled unemployment rate. Without wage rigidities, the unemployment rates remain unchanged but the wage dispersion widens. [less ▲]

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See detailMicroeconomic Uncertainty and Macroeconomic Indeterminacy
Fagnart, Jean-François; Pierrard, Olivier; Sneessens, Henri UL

in European Economic Review (2007), 51(6), 1564-1588

We construct a stylised intertemporal macroeconomic model to illustrate how the combination of decentralised trading and microeconomic uncertainty can generate coordination problems and indeterminacy of ... [more ▼]

We construct a stylised intertemporal macroeconomic model to illustrate how the combination of decentralised trading and microeconomic uncertainty can generate coordination problems and indeterminacy of the macroeconomic equilibrium. With a competitive labour market and a fixed labour supply, the range of equilibria depends mainly on the variance of the idiosyncratic shocks and may thus remain fairly narrow. The situation is different when there is imperfect competition on the labour market. The existence of real rigidities is apt to considerably increase the size of the interval of indeterminacy, for a given variance of the shocks. [less ▲]

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See detailJob turnover, unemployment and labor market institutions
Joseph, Gilles; Pierrard, Olivier; Sneessens, Henri UL

in Labour Economics (2004), 11(4), 451-468

This paper studies the role of labor market institutions on unemployment and on the cyclical properties of job flows. We construct an intertemporal general equilib- rium model with search unemployment and ... [more ▼]

This paper studies the role of labor market institutions on unemployment and on the cyclical properties of job flows. We construct an intertemporal general equilib- rium model with search unemployment and endogenous job turnover, and examine the consequences of introducing an unemployment benefit, a firing cost and a downward wage rigidity. The model is able to reproduce the main cyclical properties of a typical European economy. It also suggests that downward wage rigidities, rather than unem- ployment benefit or firing cost, may well play a dominant role in explaining both the high unemployment rate and the cyclical properties of such an economy. [less ▲]

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See detailEffets des préretraites sur l'emploi
Sneessens, Henri UL; Pierrard, Olivier; Shadman, Fatemeh

in Revue Française d'Economie (2003), 18(1), 133-155

The paper analyzes the mechanisms by which policies aiming at downsizing the labour force (like early retirement policies) may in fact lead to lower employment levels, even though the equilibrium ... [more ▼]

The paper analyzes the mechanisms by which policies aiming at downsizing the labour force (like early retirement policies) may in fact lead to lower employment levels, even though the equilibrium unemployment rate is decreased. Numerical examples suggest that job losses may be potentially important, even in the case where early retirements are concentrated among groups with high unemployment levels (low-skilled workers). The model takes into account the effects coming from imperfect competition and wage negotiations, as well as those coming from frictions and matching difficulties in an economy with continuous job creations and destructions. Reducing the labour force by promoting early retirement induces in the long run an increase in labour costs, either directly through the effect of unemployment on wages, or indirectly via the effect of unemployment on hiring difficulties. [less ▲]

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