TY  - RPRT
        AU  - Lindbeck, Assar
AU  - Snower, Dennis J.
        TI  - The Insider-Outsider Theory: A Survey
        PY  - 2002/Jul/
        PB  - Institute of Labor Economics (IZA)
        CY  - Bonn
        T2  - IZA Discussion Paper
        IS  - 534
        UR  - https://www.iza.org/publications/dp534
        AB  - This article is an idiosyncratic survey of the insider-outsider theory, describing the vision
underlying the theory, and evaluating salient contributions to the literature in the light of this
vision. We also indicate what appear to have been dead-ends and red herrings in past
research. The first section deals with the theory, concerning how labor turnover costs
influence insider wages and outsiders’ opportunities and how these costs affect employment
and unemployment. We also address the more complex, and open, question of how
employment and unemployment move through time, in response to labor market shocks. The
second section deals with the insider-outsider theory in relation to two important economic
institutions: unions and social norms. The third section confronts the relevant empirical
evidence. Finally, the last section concludes by clarifying some common misunderstandings
and identifying promising areas of future research.
        KW  - employment
KW  - unemployment
KW  - wages
KW  - insiders
KW  - outsiders
KW  - unemployment persistence
KW  - social exclusion
KW  - labor turnover costs
        ER  -