Partisan Influence on Labour Policy: Do Parties Matter?

The hypothesis of partisan influence on labour policy asserts that left-wing parties should foster the interests of the most vulnerable sectors of the labour market. The present paper employs panel data to explain variation in this policy area across 19 OECD countries from 1985 to 2011. I operationalise labour policies using the OECD employment protection legislation indexes and the amount of financial resources allocated in active (ALMP) and passive (PLMP) labour market policies. The hypothesis of partisan influence is tested in a multivariate regression framework, controlling for exogenous elements such as institutional arrangements, financial constraints and economic circumstances. Notwithstanding the starting hypothesis, preliminary results suggest that, after the dualisation of labor force into individuals with (insiders) and without (outsiders) permanent contracts, left-wing parties tend to pursue policies that benefit their historically meaningful group of voters, the insiders, ignoring the interests of the most vulnerable workers, the outsiders.