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Fixed-term Contracts and Employment Adjustment: An Empirical Test of the Core-Periphery Hypothesis Using German Establishment Data

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CHRISTIAN PFEIFER

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Abstract

Fixed-term contracts (FTCs), an important feature of the employment relationship of the peripheral workforce, are analysed to test the following two hypotheses, which are based on dual labour market theory: (i) Firms use FTCs for the peripheral workforce to adjust the level of employment to the profit maximising level in case of demand fluctuations. (ii) Thanks to the utilisation of FTCs, the core workforce is less exposed to employment adjustment. Both hypotheses are supported by the results of the econometric analysis, which uses a German establishment panel. Copyright © 2009 The Economic Society of Australia.

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Article provided by The Economic Society of Australia in its journal Economic Record.

Volume (Year): 85 (2009)
Issue (Month): 268 (03)
Pages: 92-107
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Handle: RePEc:bla:ecorec:v:85:y:2009:i:268:p:92-107

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This page was last updated on 2009-11-28.

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