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Welfare effects of employment protection

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Author Info
Belot, M.
Boone, J.
Ours, J. C. van (Tilburg University, Center for Economic Research)

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Abstract

Employment protection is often related to costs incurred by the firms when they hire a worker. The stability of the employment relationship, enhanced by employment protection, is also favorable to the productivity of the job. We analyze employment protection focusing on this trade-off between adjustment costs and productivity. We show that from a welfare point of view there is an optimal degree of employment protection.

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Paper provided by Tilburg University, Center for Economic Research in its series Discussion Paper with number 48.

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Date of creation: 2002
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Handle: RePEc:dgr:kubcen:200248

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Find related papers by JEL classification:
J41 - Labor and Demographic Economics - - Particular Labor Markets - - - Labor Contracts
J63 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - Turnover; Vacancies; Layoffs
J68 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - Public Policy

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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    Other versions:
  2. Bertola, Giuseppe & Rogerson, Richard, 1997. "Institutions and labor reallocation," European Economic Review, Elsevier, vol. 41(6), pages 1147-1171, June. [Downloadable!] (restricted)
    Other versions:
  3. Belot, Michele & van Ours, Jan C., 2001. "Unemployment and Labor Market Institutions: An Empirical Analysis," Journal of the Japanese and International Economies, Elsevier, vol. 15(4), pages 403-418, December. [Downloadable!] (restricted)
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  4. Hogan, Seamus & Ragan, Christopher, 1998. "Job security with equilibrium unemployment," Labour Economics, Elsevier, vol. 5(2), pages 185-185, June. [Downloadable!] (restricted)
  5. Boeri, Tito, 1998. "Enforcement of Employment Security Regulations, On-The-Job Search and Unemployment Duration," CEPR Discussion Papers 1850, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
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  6. Bentolila, Samuel & Bertola, Giuseppe, 1990. "Firing Costs and Labour Demand: How Bad Is Eurosclerosis?," Review of Economic Studies, Blackwell Publishing, vol. 57(3), pages 381-402, July. [Downloadable!] (restricted)
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  8. Mortensen, Dale T & Pissarides, Christopher A, 1994. "Job Creation and Job Destruction in the Theory of Unemployment," Review of Economic Studies, Blackwell Publishing, vol. 61(3), pages 397-415, July. [Downloadable!] (restricted)
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  9. Holmlund, Bertil & Linden, Johan, 1993. "Job matching, temporary public employment, and equilibrium unemployment," Journal of Public Economics, Elsevier, vol. 51(3), pages 329-343, July. [Downloadable!] (restricted)
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  10. Hosios, Arthur J, 1990. "On the Efficiency of Matching and Related Models of Search and Unemployment," Review of Economic Studies, Blackwell Publishing, vol. 57(2), pages 279-98, April. [Downloadable!] (restricted)
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  12. Michèle Belot & Jan C. van Ours, 2004. "Does the recent success of some OECD countries in lowering their unemployment rates lie in the clever design of their labor market reforms?," Oxford Economic Papers, Oxford University Press, vol. 56(4), pages 621-642, October. [Downloadable!] (restricted)
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  13. Nickell, Stephen & Layard, Richard, 1999. "Labor market institutions and economic performance," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 46, pages 3029-3084 Elsevier. [Downloadable!] (restricted)
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  14. Lazear, Edward P, 1990. "Job Security Provisions and Employment," The Quarterly Journal of Economics, MIT Press, vol. 105(3), pages 699-726, August. [Downloadable!] (restricted)
  15. Pissarides, Christopher A., 2001. "Employment protection," Labour Economics, Elsevier, vol. 8(2), pages 131-159, May. [Downloadable!] (restricted)
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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Dolado, Juan J. & Jansen, Marcel & Jimeno, Juan Francisco, 2005. "Dual Employment Protection Legislation: A Framework for Analysis," CEPR Discussion Papers 5033, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
    Other versions:
  2. Erol Taymaz & Sule Ozler, 2004. "Labor Market Policies and EU Accession: Problems and Prospects for Turkey," ERC Working Papers 0405, ERC - Economic Research Center, Middle East Technical University, revised Mar 2004. [Downloadable!]
  3. H. Takizawa, 2003. "Job-Specific Investment and the Cost of Dismissal Restrictions--The Case of Portugal," IMF Working Papers 03/75, International Monetary Fund. [Downloadable!]
  4. Juan J. Dolado & Marcel Jansen & Juan F. Jimeno, 2007. "A Positive Analysis of Targeted Employment Protection Legislation," IZA Discussion Papers 2679, Institute for the Study of Labor (IZA). [Downloadable!]
  5. Herbert Buscher & Christian Dreger & Raul Ramos & Jordi Surinach, 2005. "The Impact of Institutions on the Employment Performance in European Labour Markets," IZA Discussion Papers 1732, Institute for the Study of Labor (IZA). [Downloadable!]
  6. Koeniger, Winfried, 2002. "Employment Protection, Product Market Competition and Growth," IZA Discussion Papers 554, Institute for the Study of Labor (IZA). [Downloadable!]
  7. Paolo Naticchioni & Emiliano Rustichelli & Antonio Scialà, 2003. "Employment protection and regional worker flows in Italy: an assessment of the theoretical predictions," Working Papers 1 DE-ISFOL, Dipartimento di Economia, Sapienza University of Rome, revised 2003. [Downloadable!]
  8. Florian Baumann & Nikolai Stähler, 2005. "Financing Unemployment Benefits: Dismissal versus Employment Taxes," Working Papers of the Research Group Heterogenous Labor 05-03, Research Group Heterogeneous Labor, University of Konstanz/ZEW Mannheim. [Downloadable!]
    Other versions:
  9. Andrea Bassanini & Danielle Venn, 2008. "The Impact of Labour Market Policies on Productivity in OECD Countries," International Productivity Monitor, Centre for the Study of Living Standards, vol. 17, pages 3-15, Fall. [Downloadable!]
  10. Bruno Deffains & Yannick Gabuthy & Eve-Angéline Lambert, 2007. "Labor Conflicts and Inefficiency of Relationship-Specific Investments: What is the Judge's Role?," Working Papers of BETA 2007-04, Bureau d'Economie Théorique et Appliquée, ULP, Strasbourg. [Downloadable!]
  11. Laszlo Goerke & Markus Pannenberg, 2005. "Berufliche Weiterbildung "on-the-job" und Auflösung von Beschäftigungsverhältnissen," Working Papers of the Research Group Heterogenous Labor 04-22, Research Group Heterogeneous Labor, University of Konstanz/ZEW Mannheim. [Downloadable!]
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