Competitiveness and Unemployment in the Eurozone

Abstract

The paper analyzes the long term dynamics of the relationship between the competitiveness and the unemployment in the Eurozone, with the emphasis on the "North" and "South" differences. Using the productivity per person as a proxy for competitiveness, it shows both the differences between the North and South of the Eurozone and the differences between the pre-crisis and crisis periods in both areas. Moreover, it demonstrates that the relationship between the competitiveness and unemployment is negative in the North and undetectable in the most of the South. These results indicate that the recent gains in competitiveness can be preserved-and even perhaps extended-without the negative impact on employment. Indeed, in this context the structural reforms are the key.

The Quality of Entrepreneurial Activity and Economic Competitiveness in European Union Countries: A Panel Data Approach

“…Our findings are in line with those of Chen et al (2007), Gallegati et al (2014), Rusek (2015), Chen (2017) andWorld Bank Group (2017).…”

“…Significant direct relationship between innovation of entrepreneurial activities and competitiveness Cantwell 2003;Özçelik and Taymaz 2004;Ghoniem and El Khouly 2012;Petrariu et al 2013;Huggins et al 2014;Ciocanel and Pavelescu 2015;Dogan 2016;Matos Ferreira et al 2017;Herman 2018 Positive correlation between employment and increase in competitiveness Moser et al 2010;Martus 2013;Rusek 2015;OECD 2016;World Bank Group 2017 Negative relationship between high job creation expectation rate and economic competitiveness Chen et al 2007;Gallegati et al 2014 Entrepreneurial activity and competitiveness have been the research topic of a large number of authors, enjoying increased attention on how entrepreneurs innovate and consequently contribute to higher levels of competitiveness. Reviewing the literature, we can assert that the quality of entrepreneurship, measured by innovation and job creation, is important in order to achieve economic competitiveness.…”

“…Other papers (Moser et al 2010;Martus 2013;Rusek 2015;OECD 2016;World Bank Group 2017) also highlight the importance of job creation for ensuring economic growth and increased national competitiveness, identifying a positive correlation between employment and increase in competitiveness, although, in some countries this effect is small. Also, these papers emphasize the importance of supporting entrepreneurship and SMEs in order to promote growth and strengthening the local economic base.…”

“…Thus, stimulating competitiveness through industrial upgrading can also induce dislocations as resources shift within and between sectors, which can determine unemployment and can destabilize some firms, industries, or whole regions. Moreover, the effort to restore and improve the competitiveness implies the improvement of the unit labor costs which in turn requires a higher productivity (Rusek 2015) but productivity creates unemployment on short and medium terms, and employment in the long run (Chen et al 2007;Gallegati et al 2014;Semmler and Chen 2017).…”

Business Dynamism and Innovation Capacity, an Entrepreneurship Worldwide Perspective

“…No studies were found that relate these two variables. However, some authors indicate that there is a negative relationship between high job creation expectations and economic competitiveness [72,73].…”