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Evaluation of internship contract in Spain

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  • Sara de la Rica
  • Lucía Gorjón

Abstract

This report evaluates the impact of this Active Labor Market Policy. The evidence shows that the use made of the IC is contrary to the spirit of the law. First, employment under the IC reduces the probability of being retained by the firm; second, for those who stay in the firm after the IC, their probability of signing an indefinite contract is significantly lower than that for those who sign another temporary contract. However, for those who move to another firm, the probability of signing an indefinite contract is higher if they come from an IC. These results suggest that firms do not use IC as an instrument for investing in training young people, but rather as an instrument for reducing labour costs and/or increasing contractual flexibility..

Suggested Citation

  • Sara de la Rica & Lucía Gorjón, 2021. "Evaluation of internship contract in Spain," Studies on the Spanish Economy eee2021-08, FEDEA.
    • Handle: RePEc:fda:fdaeee:eee2021-08
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    References listed on IDEAS

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    1. Yolanda Rebollo Sanz & J. Ignacio García-Pérez, 2009. "Do wage subsidies affect the subsequent employment stability of permanent workers?: the case of Spain," Working Papers 09.18, Universidad Pablo de Olavide, Department of Economics.
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    1. Sara Rica & Lucía Gorjón, 2022. "Internship contracts in Spain: a stepping stone or a hurdle towards job stability?," SERIEs: Journal of the Spanish Economic Association, Springer;Spanish Economic Association, vol. 13(1), pages 51-100, May.

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