The Political Economy of Employment Regulation in Small Developing Countries

There is very little academic research into employment regulation in small developing countries. Regulation offers mechanisms both to protect workers and generate economic growth, specifically formal employment, but little is known about the process of regulation in these contexts. This article explores developments in labour regulation in three small developing countries in the South Pacific based on a program of qualitative interviews and documentary analysis. The paper identifies a number of structural and agency constraints reflecting political factors that include disorganized employment relations, under-developed civil society institutions, concentration of power networks, the under-resourcing and compartmentalization of state institutions and a broader context of political change and instability. These factors, which are related to size as well as stage of development, subvert the introduction, implementation and review of employment regulation even where efficiency and equity arguments may be accepted by policymakers. The need and implications for future research are identified.