a column by Pierre Cahuc, Franck Malherbet and Julien Prat for VOX: CEPR’s Policy Portal
Standard economic models predict that employment protection legislation reduces both job destruction and job creation, with the negative impact on job creation caused by the anticipation of separation costs.
This column shows that in France, this anticipation effect not only plays a key role in reducing job creation but also increases job destruction among low-skilled workers, an effect that is amplified by the presence of the minimum wage. This mechanism implies that job protection is strongly detrimental to employment in the French context.
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Showing posts with label employment_protection. Show all posts
Showing posts with label employment_protection. Show all posts
Monday, 17 June 2019
Thursday, 16 July 2015
Cumulative (Dis)advantage? The Impact of Labour Market Policies on Late Career Employment from a Life Course Perspective
an article by Jenny Bennett (Institut für Sozialforschung und Gesellschaftspolitik, Cologne, Germany) and Katja Mohring (University of Bremen, Germany) published in Journal of Social Policy Volume 44 Issue 2 (April 2015)
Abstract
We investigate the labour market situation of older individuals in Europe in relation to their previous employment history as well as the regulations relating to employment protection legislation and early retirement. Specifically, we look at the competing risks of early retirement and late career unemployment.
The central research question is whether policy effects differ according to the characteristics of an individual’s previous work history. We employ data for twelve European countries from the Survey of Health, Ageing and Retirement in Europe (SHARELIFE) and estimate multilevel regression models.
The results show different mechanisms for the risks of unemployment and early retirement. Late career unemployment results from individual factors related to fragmented careers, marginal employment and short tenures.
In the case of early retirement, we find the interplay of individual and policy factors to be crucial. Persons with consistent careers have an increased probability of early retirement, but only in countries with generous early retirement benefits.
However, employment protection legislation appears to counteract early retirement for this group of individuals. We conclude that policy factors do not have uniform effects for older individuals, but should rather be viewed against the background of previous developments in individual career paths.
Abstract
We investigate the labour market situation of older individuals in Europe in relation to their previous employment history as well as the regulations relating to employment protection legislation and early retirement. Specifically, we look at the competing risks of early retirement and late career unemployment.
The central research question is whether policy effects differ according to the characteristics of an individual’s previous work history. We employ data for twelve European countries from the Survey of Health, Ageing and Retirement in Europe (SHARELIFE) and estimate multilevel regression models.
The results show different mechanisms for the risks of unemployment and early retirement. Late career unemployment results from individual factors related to fragmented careers, marginal employment and short tenures.
In the case of early retirement, we find the interplay of individual and policy factors to be crucial. Persons with consistent careers have an increased probability of early retirement, but only in countries with generous early retirement benefits.
However, employment protection legislation appears to counteract early retirement for this group of individuals. We conclude that policy factors do not have uniform effects for older individuals, but should rather be viewed against the background of previous developments in individual career paths.
Monday, 23 July 2012
Institutional reforms and age-graded labour market inequalities in Europe
an article by Martina Dieckhoff (Social Science Research Center Berlin, Germany) and Nadia Steiber (European University Institute, Italy) published in International Journal of Comparative Sociology Volume 53 Number 2 (April 2012)
Abstract
This article examines how institutional change affects age-based labour market inequalities in Europe. We focus on the impact of labour regulation and of wage-setting institutions on the male population aged 25–54.
Age-graded labour market inequalities within this group of prime-age individuals are hitherto under-researched.
We estimate country panel regressions using data from the European Union Labour Force Survey and time-series data on institutional change for the years 1992–2007. The results present evidence that employment protection and the regulation of temporary work affect age-based inequality dynamics, while union strength has positive employment effects on all age-groups.
Abstract
This article examines how institutional change affects age-based labour market inequalities in Europe. We focus on the impact of labour regulation and of wage-setting institutions on the male population aged 25–54.
Age-graded labour market inequalities within this group of prime-age individuals are hitherto under-researched.
We estimate country panel regressions using data from the European Union Labour Force Survey and time-series data on institutional change for the years 1992–2007. The results present evidence that employment protection and the regulation of temporary work affect age-based inequality dynamics, while union strength has positive employment effects on all age-groups.
Monday, 5 March 2012
The consequences of employment protection legislation for the youth labour market
a working paper (Nr. 144, 2011) from the Mannheim Centre for European Social Research by Clemens Noelk (formerly of Mannheim Centre for European Social Research (MZES) and now a lecturer at the Department of Sociology, Harvard University)
Abstract
Understanding the causes of unemployment and job insecurity among young people remains a central concern for social scientists and policy makers.
This study focuses on one potential institutional cause of high youth unemployment, employment protection legislation (EPL). While many are sceptical of a link between EPL and high aggregate unemployment rates, a consensus has emerged linking EPL to high youth unemployment in particular.
The review of theoretical and empirical research conducted here challenges this consensus. Search and matching theoretic explanations have difficulty making unambiguous predictions about the effects of EPL on youth unemployment and empirical research has undertaken little effort to uncover its causal effects. The empirical analysis tests for the existence of aggregate employment effects of EPL across youth labour markets using aggregate data from affluent OECD countries (1985–2007) and individual data from labour force surveys for 15 Western European countries and the U.S. (1992–2007).
It conducts conventional regression analyses and also implements a Difference-in-Difference design. Neither conventional nor Difference-in-Difference analyses yield any robust evidence whatsoever linking either dimension of EPL to inferior youth labour market performance, for any of the education groups or institutional conditions tested. Altogether, this study rejects the view that strict EPL is or has been the cause of high youth unemployment rates or low youth employment rates, at least for the sample of countries tested here.
Full text (PDF 39pp) for which a token fee of 3 Euros is suggested (but no indication as to how to pay)
Abstract
Understanding the causes of unemployment and job insecurity among young people remains a central concern for social scientists and policy makers.
This study focuses on one potential institutional cause of high youth unemployment, employment protection legislation (EPL). While many are sceptical of a link between EPL and high aggregate unemployment rates, a consensus has emerged linking EPL to high youth unemployment in particular.
The review of theoretical and empirical research conducted here challenges this consensus. Search and matching theoretic explanations have difficulty making unambiguous predictions about the effects of EPL on youth unemployment and empirical research has undertaken little effort to uncover its causal effects. The empirical analysis tests for the existence of aggregate employment effects of EPL across youth labour markets using aggregate data from affluent OECD countries (1985–2007) and individual data from labour force surveys for 15 Western European countries and the U.S. (1992–2007).
It conducts conventional regression analyses and also implements a Difference-in-Difference design. Neither conventional nor Difference-in-Difference analyses yield any robust evidence whatsoever linking either dimension of EPL to inferior youth labour market performance, for any of the education groups or institutional conditions tested. Altogether, this study rejects the view that strict EPL is or has been the cause of high youth unemployment rates or low youth employment rates, at least for the sample of countries tested here.
Full text (PDF 39pp) for which a token fee of 3 Euros is suggested (but no indication as to how to pay)
Wednesday, 23 November 2011
Understanding unemployment flows
an article by Ekkehard Ernst and Uma Rani published in Oxford Review of Economic Policy Volume 27 Issue 2 (Summer 2011)
Abstract
This article reviews the current state of research on unemployment dynamics in macroeconomic models. In particular, it discusses the increasingly widespread use of the labour-market flow approach as implemented via a search and matching process and presents main policy considerations that arise from this approach related to unemployment benefit systems and employment protection. It reviews the implications of the labour-flow approach for dynamic properties of macroeconomic models and discusses policy implications for macroeconomic and labour-market policies. Finally, it presents new evidence on the effectiveness of policies to influence unemployment in- and outflows.
Full text available for short-term access for $32
Abstract
This article reviews the current state of research on unemployment dynamics in macroeconomic models. In particular, it discusses the increasingly widespread use of the labour-market flow approach as implemented via a search and matching process and presents main policy considerations that arise from this approach related to unemployment benefit systems and employment protection. It reviews the implications of the labour-flow approach for dynamic properties of macroeconomic models and discusses policy implications for macroeconomic and labour-market policies. Finally, it presents new evidence on the effectiveness of policies to influence unemployment in- and outflows.
Full text available for short-term access for $32
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