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The Substitution of Worksharing and Short-Time Compensation in France: A Difference-in-differences Approach

Author

Listed:
  • Richard Duhautois

    (CEE-TEPP, University of Paris-Est- Marne-la-Vallée and CREST)

  • Emmanuelle Walkowiak

    (University of Paris 12-ERUDITE and CEE)

  • Oana Calavrezo

    (LEO, University of Orleans and CEE)

Abstract

The short-time compensation (STC) program aims at avoiding redundancies in case of strong short-term downturns. In the literature, STC is an instrument of both job security and flexibility. This paper investigates the impact of worksharing on STC in France. The form of worksharing examined in this study is the reduction of the standard or contractual hours worked per week to 35 hours in France. We quantify the average decrease in the STC recourse with difference-in-differences estimators assessed on a balanced panel of French establishments. We highlight a substitution effect between STC and worksharing due to their internal flexibility role. As a consequence, STC seems to be less used as a flexibility device and the worksharing policy would refocus STC on its employment protection role.

Suggested Citation

  • Richard Duhautois & Emmanuelle Walkowiak & Oana Calavrezo, 2009. "The Substitution of Worksharing and Short-Time Compensation in France: A Difference-in-differences Approach," Economics Bulletin, AccessEcon, vol. 29(2), pages 820-833.
    • Handle: RePEc:ebl:ecbull:eb-08j20016
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    References listed on IDEAS

    as
    1. Kapteyn, Arie & Kalwij, Adriaan & Zaidi, Asghar, 2004. "The myth of worksharing," Labour Economics, Elsevier, vol. 11(3), pages 293-313, June.
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    3. Burdett, Kenneth & Wright, Randall, 1989. "Unemployment Insurance and Short-Time Compensation: The Effects on Layoffs, Hours per Worker, and Wages," Journal of Political Economy, University of Chicago Press, vol. 97(6), pages 1479-1496, December.
    4. Van Audenrode, Marc A, 1994. "Short-Time Compensation: Job Security, and Employment Contracts: Evidence from Selected OECD Countries," Journal of Political Economy, University of Chicago Press, vol. 102(1), pages 76-102, February.
    5. Askenazy, Philippe, 2008. "A Primer on the 35-Hour in France, 1997–2007," IZA Discussion Papers 3402, Institute of Labor Economics (IZA).
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    7. Katharine G. Abraham & Susan N. Houseman, 1994. "Does Employment Protection Inhibit Labor Market Flexibility? Lessons from Germany, France, and Belgium," NBER Chapters, in: Social Protection versus Economic Flexibility: Is There a Trade-Off?, pages 59-94, National Bureau of Economic Research, Inc.
    8. Stephen Walsh & Rebecca London & Deana McCanne & Karen Needels & Walter Nicholson & Stuart Kerachsky, 1997. "Evaluation of Short-Time Compensation Programs: Final Report," Mathematica Policy Research Reports 4478280a4e4f4cdeaed9a7645, Mathematica Policy Research.
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    Citations

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    Cited by:

    1. Calavrezo, Oana & Duhautois, Richard & Walkowiak, Emmanuelle, 2010. "Short-Time Compensation and Establishment Exit: An Empirical Analysis with French Data," IZA Discussion Papers 4989, Institute of Labor Economics (IZA).
    2. Philippe Askenazy, 2013. "Working time regulation in France from 1996 to 2012," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 37(2), pages 323-347.
    3. Gonthier, Pauline, 2012. "Why Was Short-Time Work Unattractive During the Crisis?," Institute for Research on Labor and Employment, Working Paper Series qt5dn0w9b1, Institute of Industrial Relations, UC Berkeley.
    4. José M. Arranz & Carlos García†Serrano & Virginia Hernanz, 2018. "Short†Time Work and Employment Stability: Evidence from a Policy Change," British Journal of Industrial Relations, London School of Economics, vol. 56(1), pages 189-222, March.

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    More about this item

    JEL classification:

    • J2 - Labor and Demographic Economics - - Demand and Supply of Labor
    • C1 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General

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