Advanced Search
MyIDEAS: Login to save this paper or follow this series

Last in, first out? Estimating the effect of seniority rules in Sweden

Contents:

Author Info

  • von Below, David

    ()
    (Institute for International Economic Studies)

  • Thoursie, Peter

    ()
    (Department of Economics, Stockholm University)

Abstract

In this paper we investigate whether a relaxation in seniority rules (the ‘last-in-first-out’ principle) had any effect on firms’ employment behaviour. Seniority rules exist in several countries and, like Sweden, most European countries have a more lenient employment protection for firms below a certain size. Despite the fact that small firms represent a large share of all firms and stand for a substantial share of total employment, there is limited knowledge of how such exemption rules affect firms’ employment behaviour — the consequences of seniority rules on firms’ employment behaviour have not been examined at all. Using data including the population of firms matched with the population of workers for the period 1999–2002, we do not find any general effects on worker flows or on hires and separations. The only exception is a tendency of an increase in the share of separations for older workers and workers with longer seniority. The result points to the importance of considering in detail how legislation is formulated and how it works in practice.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://www.ifau.se/upload/pdf/se/2008/wp08-27.pdf
Download Restriction: no

Bibliographic Info

Paper provided by IFAU - Institute for Evaluation of Labour Market and Education Policy in its series Working Paper Series with number 2008:27.

as in new window
Length: 43 pages
Date of creation: 12 Nov 2008
Date of revision:
Publication status: Published as von Below, David and Peter Thoursie, 'Last in, first out? Estimating the effect of seniority rules in Sweden' in Labour Economics, 2010, pages 987-997.
Handle: RePEc:hhs:ifauwp:2008_027

Contact details of provider:
Postal: IFAU, P O Box 513, SE-751 20 Uppsala, Sweden
Phone: (+46) 18 - 471 70 70
Fax: (+46) 18 - 471 70 71
Email:
Web page: http://www.ifau.se/
More information through EDIRC

Related research

Keywords: Employment protection; employment change; hires; separations; regression discontinuity;

Find related papers by JEL classification:

This paper has been announced in the following NEP Reports:

References

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.:
as in new window
  1. Howell David R. & Baker Dean & Glyn Andrew & Schmitt John, 2007. "Are Protective Labor Market Institutions at the Root of Unemployment? A Critical Review of the Evidence," Capitalism and Society, De Gruyter, vol. 2(1), pages 1-73, May.
  2. David H. Autor & John J. Donohue III & Stewart J. Schwab, 2003. "The Costs of Wrongful-Discharge Laws," NBER Working Papers 9425, National Bureau of Economic Research, Inc.
  3. Marianne Bertrand & Esther Duflo & Sendhil Mullainathan, 2002. "How Much Should We Trust Differences-in-Differences Estimates?," NBER Working Papers 8841, National Bureau of Economic Research, Inc.
  4. Fabiano Schivardi & Roberto Torrini, 2004. "Threshold effects and firm size: the case of firing costs," LSE Research Online Documents on Economics 19956, London School of Economics and Political Science, LSE Library.
  5. Lindbeck, Assar & Palme, Mårten & Persson, Mats, 2006. "Job Security and Work Absence: Evidence form a Natural Experiment," Seminar Papers 743, Stockholm University, Institute for International Economic Studies.
  6. Sebastian Buhai & Miguel Portela & Coen Teulings & Aico van Vuuren, 2008. "Returns to Tenure or Seniority?," 2008 Meeting Papers 623, Society for Economic Dynamics.
  7. Guido Imbens & Thomas Lemieux, 2007. "Regression Discontinuity Designs: A Guide to Practice," NBER Working Papers 13039, National Bureau of Economic Research, Inc.
  8. Pietro Garibaldi & Lia Pacelli & Andrea Borgarello, 2004. "Employment Protection Legislation and the Size of Firms," Giornale degli Economisti, GDE (Giornale degli Economisti e Annali di Economia), Bocconi University, vol. 63(1), pages 33-68, April.
  9. Olsson, Martin, 2009. "Employment protection and sickness absence," Labour Economics, Elsevier, vol. 16(2), pages 208-214, April.
  10. James J. Heckman & Carmen Pages, 2000. "The Cost of Job Security Regulation: Evidence from Latin American Labor Markets," NBER Working Papers 7773, National Bureau of Economic Research, Inc.
  11. Kugler, Adriana & Pica, Giovanni, 2008. "Effects of employment protection on worker and job flows: Evidence from the 1990 Italian reform," Labour Economics, Elsevier, vol. 15(1), pages 78-95, February.
  12. Bauer, Thomas K. & Bender, Stefan & Bonin, Holger, 2004. "Dismissal Protection and Worker Flows in Small Establishments," IZA Discussion Papers 1105, Institute for the Study of Labor (IZA).
  13. Hernanz, Virginia & Jimeno, Juan Francisco & Kugler, Adriana D., 2003. "Employment Consequences of Restrictive Permanent Contracts: Evidence from Spanish Labour Market Reforms," CEPR Discussion Papers 3724, C.E.P.R. Discussion Papers.
  14. Boeri, Tito & Jimeno, Juan F., 2005. "The effects of employment protection: Learning from variable enforcement," European Economic Review, Elsevier, vol. 49(8), pages 2057-2077, November.
  15. Adriana Kugler, 2004. "The Effect of Job Security Regulations on Labor Market Flexibility: Evidence from the Colombian Labor Market Reform," NBER Working Papers 10215, National Bureau of Economic Research, Inc.
  16. Timothy G. Conley & Christopher R. Taber, 2011. "Inference with "Difference in Differences" with a Small Number of Policy Changes," The Review of Economics and Statistics, MIT Press, vol. 93(1), pages 113-125, February.
  17. Pissarides, Christopher A., 2001. "Employment protection," Labour Economics, Elsevier, vol. 8(2), pages 131-159, May.
  18. Giuseppe Bertola & Francine Blau & Lawrence Kahn, 2007. "Labor market institutions and demographic employment patterns," Journal of Population Economics, Springer, vol. 20(4), pages 833-867, October.
  19. Stephen G. Donald & Kevin Lang, 2007. "Inference with Difference-in-Differences and Other Panel Data," The Review of Economics and Statistics, MIT Press, vol. 89(2), pages 221-233, May.
  20. Lee, David S., 2008. "Randomized experiments from non-random selection in U.S. House elections," Journal of Econometrics, Elsevier, vol. 142(2), pages 675-697, February.
  21. Mortensen, Dale T & Pissarides, Christopher, 1999. "New Developments in Models of Search in the Labour Market," CEPR Discussion Papers 2053, C.E.P.R. Discussion Papers.
  22. David H. Autor & William R. Kerr & Adriana D. Kugler, 2007. "Do Employment Protections Reduce Productivity? Evidence from U.S. States," Harvard Business School Working Papers 07-048, Harvard Business School.
  23. Lemieux, Thomas & Milligan, Kevin, 2008. "Incentive effects of social assistance: A regression discontinuity approach," Journal of Econometrics, Elsevier, vol. 142(2), pages 807-828, February.
  24. Andrea Bassanini & Romain Duval, 2006. "Employment Patterns in OECD Countries: Reassessing the Role of Policies and Institutions," OECD Social, Employment and Migration Working Papers 35, OECD Publishing.
  25. David H. Autor & John J. Donohue & Stewart J. Schwab, 2004. "The Employment Consequences of Wrongful-Discharge Laws: Large, Small, or None at All?," American Economic Review, American Economic Association, vol. 94(2), pages 440-446, May.
  26. Pedro S. Martins, 2009. "Dismissals for Cause: The Difference That Just Eight Paragraphs Can Make," Journal of Labor Economics, University of Chicago Press, vol. 27(2), pages 257-279, 04.
  27. Addison, John T. & Teixeira, Paulino, 2001. "The Economics of Employment Protection," IZA Discussion Papers 381, Institute for the Study of Labor (IZA).
  28. McCrary, Justin, 2008. "Manipulation of the running variable in the regression discontinuity design: A density test," Journal of Econometrics, Elsevier, vol. 142(2), pages 698-714, February.
  29. Adriana Kugler adkugler@uh.edu & Giovanni Pica, 2005. "The Effects of Employment Protection on the Italian Labour Market," CSEF Working Papers 135, Centre for Studies in Economics and Finance (CSEF), University of Naples, Italy.
  30. Bertola, Giuseppe, 1990. "Job security, employment and wages," European Economic Review, Elsevier, vol. 34(4), pages 851-879, June.
  31. Miles, Thomas J, 2000. "Common Law Exceptions to Employment at Will and U.S. Labor Markets," Journal of Law, Economics and Organization, Oxford University Press, vol. 16(1), pages 74-101, April.
Full references (including those not matched with items on IDEAS)

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Martin Andersson & Steven Klepper, 2013. "Characteristics and performance of new firms and spinoffs in Sweden," Industrial and Corporate Change, Oxford University Press, vol. 22(1), pages 245-280, February.
  2. John Martin & Stefano Scarpetta, 2012. "Setting It Right: Employment Protection, Labour Reallocation and Productivity," De Economist, Springer, vol. 160(2), pages 89-116, June.
  3. Heyman, Fredrik & Skedinger, Per, 2011. "Employment Protection Reform, Enforcement in Collective Agreements and Worker Flows," Working Paper Series 876, Research Institute of Industrial Economics.
  4. von Below, David & Thoursie, Peter Skogman, 2010. "Last in, first out?: Estimating the effect of seniority rules in Sweden," Labour Economics, Elsevier, vol. 17(6), pages 987-997, December.
  5. Skedinger, Per, 2011. "Employment Consequences of Employment Protection Legislation," Working Paper Series 865, Research Institute of Industrial Economics.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:hhs:ifauwp:2008_027. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Margareta Wicklander).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.