Partisan Influence on Labour Policy: Do Parties Matter?

The hypothesis of partisan influence on labor policy asserts that social-democratic parties should provide equality and security to the most vulnerable sectors of the labor market. After reviewing the existing literature, the present paper employs time series cross-sectional data to explain variation in this policy area across 16 OECD countries from 1973 to 2012. I operationalise labor policies as the amount of financial resources allocated in active (ALMP) or passive (PLMP) labour market policies and test the hypothesis of partisan influence in a multivariate regression framework, controlling for exogenous elements such as institutional arrangements, financial constraints and economic circumstances. Notwithstanding the starting hypothesis, preliminary results seem to suggest that after the dualisation of labor force into individuals with (insiders) and without (outsiders) permanent contracts, social-democratic 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.