Flexibilization, deregulation and dualization: institutional change and trajectories of labor market liberalization

Abstract

This paper reviews the literature on the "trajectories of the liberalization", from a comparative political economy (CPE) approach, that explains the institutional change that has taken place in the labor market in recent decades. Grouped under the term "liberalization trajectories", two main trajectories can be identified: deregulation and dualization. To this end, we review the contributions of the theory of power resources and the research tradition of historical institutionalism. Based on a synthesis of both, We hold as the main thesis that labor segmentation is the result of an interaction between employers' “divide et impera” (agency) strategies and the gradual change marked by the reduction of workers' associational and structural power, which undermines both the protective institutions (structure) and the trade union strategies needed to combat segmentation. These dynamics generate different trajectories, even if they share an institutional shift towards liberalization.