ABSTRACT
Rüdiger Soltwedel and Peter Trapp give us a comprehensive survey of the various labour market regulations in Germany and try to assess their impact on employment. They reveal a permanent deterioration in the institutional framework of the labour market and suggest that this was the main cause of the increase in the natural rate of unemployment. I 238must confess that I feel much in sympathy with the spirit of the paper. It provides us with convincing examples conducive to teaching politicians what negative effects they can generate if they limit the freedom of contract. It is also important to confront labour courts on the employment implications of their sentences.
