Labor Standards and Labor Market Flexibility in East Asia

Since the 1980s, de jure labor standards have improved in Northeast and Southeast Asia and de jure labor market flexibility has decreased. For most countries in the region, however, de facto labor standards are much worse than de jure standards, and de facto flexibility is much higher than de jure flexibility. International pressure has rarely produced meaningful change in either labor standards or labor market flexibility. Authoritarian regimes have proven the most immune to international pressures to improve labor standards and to increase labor market flexibility. The most significant improvements to labor standards usually follow democratization, with international influences working in tandem with domestic pressures. International actors have had little effect on improving labor standards in semi-democracies, with the exception of Cambodia, but progress there depended on a carrot, not a stick. Demands by the international financial institutions to increase labor market flexibility have been minimal, with the notable exception of South Korea. Both democracies and authoritarian regimes have adopted laws that reduce labor market flexibility, and domestic political concerns rather than international influences were the primary driving force.