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On Short-Term Contracts Regulations

Luca Nunziata and Stefano Staffolani

No 2001-W7, Economics Papers from Economics Group, Nuffield College, University of Oxford

Abstract: We present a theoretical as well as empirical analysis of the impact of employment regulations on permanent and temporary employment. We consider three different forms of such regulations, namely insider protection, fixed term contract regulations, and legislation on temporary work agencies, and we present some empirical evidence as regards total, female and young employees based on a panel of nine European countries. We show that these three types of regulations have different impacts on the employment performances of those countries. Moreover, these institutions act asymmetrically along the business cycle. The most notable findings are that lower employment protection leads to the substitution of permanent employees by termporary ones with an insignificant net effect on the total; more flexible regulations on fixed term contracts have a beneficial effect on temporary as well as permanent employment among young people; flexible regulations on temporary work agencies have a positive impact on temporary employment, while they may reduce permanent employment.

Keywords: Fixed Term Contracts; Temporary Work Agencies; Temporary Employment; Labour Market Institutions; Employment Protection (search for similar items in EconPapers)
JEL-codes: E24 J21 J23 (search for similar items in EconPapers)
Pages: 36pages
Date: 2001-06-28
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (15)

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