Wednesday, 30 January 2019

Subsidising labour hoarding in recessions: New evidence from Italy’s Cassa Integrazione

a column by Giulia Giupponi and Camille Landais for VOX: CEPR’s Policy Portal

Labour hoarding – the practice of retaining excess employees during a negative shock – could potentially help firms avoid re-hiring and training costs when economic conditions improve and act as a form of insurance for workers.

This column uses Italian micro data to show how labour hoarding in the form of short-term work programmes can be beneficial despite being ineffective in the long term.

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