The Social Dimensions of Labour Market Institutions

The labour market is both a market and a social institution. But what do we mean by that? In the first part of this article we analyse different interpretations of the labour market's social dimension, starting with the versions postulated by economists and ending with those that invoke solidarity as a criterion. In the second part, we analyse the functions of the institutions that embody the labour market's social dimension, both from the positive viewpoint -correcting market failures- and the negative viewpoint -creating and capturing rents. Discussion of the factors that explain how these institutions come into being and evolve allows us to identify a number of institutions that perform a dual function: correcting market failures, and also correcting failures in other institutions