Job Creation and Job Destruction in a Regulated Labor Market: The Case of Austria
AbstractWe study Austrian job reallocation in the period of 1978 to 1998, using a large administrative dataset where we correct for “spurious” entries and exits of firms. We find that on average 9 out of 100 randomly selected jobs were created within the last year, and that about 9 out of randomly selected 100 jobs will be destroyed within the next year. Hence, Austrian job flows seem to be of comparable magnitude as in other countries, similar to the well-known results of Davis et al. (1996) for the United States. Job reallocation appears to be driven primarily by idiosyncratic shocks. However, job creation increases significantly during cyclical upswings whereas job destruction rises in downturns. We also find substantial persistence of job creation and destruction. We show that the pronounced pattern of job reallocation rates falling with firm size and age continues to hold when we use a set of controls. Finally, we show that - controlling for sector and for firm size composition - Austrian job reallocation rates are only half the rates for the U.S. This result is not surprising given the impact of tighter regulation and labor law in Austria.
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Bibliographic InfoPaper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 546.
Length: 27 pages
Date of creation: Aug 2002
Date of revision:
Publication status: published in: Empirica 30, 2003, 127-148.
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Other versions of this item:
- Alfred Stiglbauer & Florian Stahl & Rudolf Winter-Ebmer & Josef ZweimÃƒÂ¼ller, 2003. "Job Creation and Job Destruction in a Regulated Labor Market: The Case of Austria," Empirica, Springer, Springer, vol. 30(2), pages 127-148, June.
- Alfred M Stiglbauer & Florian Stahl & Rudolf Winter-Ebmer & Josef Zweimï¿½ller, 2002. "Job creation and job destruction in a regulated labor market: The case of Austria," Economics working papers, Department of Economics, Johannes Kepler University Linz, Austria 2002-05, Department of Economics, Johannes Kepler University Linz, Austria.
- Stahl, Florian & Stiglbauer, Alfred M. & Winter-Ebmer, Rudolf & ZweimÃ¼ller, Josef, 2002. "Job Creation and Job Destruction in a Regulated Labour Market: The Case of Austria," CEPR Discussion Papers, C.E.P.R. Discussion Papers 3497, C.E.P.R. Discussion Papers.
- Florian Stahl & Alfred Stiglbauer & Rudolf Winter-Ebmer & Josef ZweimÃ¼ller, 2002. "Job Creation and Job Destruction in a Regulated Labor Market: The Case of Austria," Working Papers, Oesterreichische Nationalbank (Austrian Central Bank) 78, Oesterreichische Nationalbank (Austrian Central Bank).
- D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
- J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
- L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
This paper has been announced in the following NEP Reports:
- NEP-ALL-2002-09-11 (All new papers)
- NEP-ENT-2002-08-29 (Entrepreneurship)
- NEP-LAB-2002-09-11 (Labour Economics)
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