LABOUR MARKET TRENDS IN CROATIA AND EUROPEAN UNION: THE IMPORTANCE OF FORMAL INSTITUTIONS

The lag of the Republic of Croatia behind the leading member states of the European Union has always been the dominant topic of empirical research in the domestic economy. The situation in the labour market in 2019, where the Republic of Croatia records one of the lowest employment rate and the participation rates, further confirms the fact of the relative lagging behind the leading EU member states. The aim of this research is to explore the relationship between the institutional framework as one of the possible lagging factors and the overall employment rate and youth employment rate in 27 EU Member States in the period 2002-2018. The results of the research indicate that this relationship is positive and statistically significant for both employment rate and youth employment rate.