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Welfare improving employment protection

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  • Belot, M.V.K.

    (Tilburg University)

  • Boone, J.

    (Tilburg University)

  • Ours, J.C. van

    (Tilburg University)

Abstract

This paper presents a theoretical model to show that in sectors where workers invest in firm specific knowledge employment protection legislation can raise employment, productivity and welfare. The model also predicts a U-shaped relation between firing costs and unemployment. Finally, it gives a rationale for the observation that more educated workers tend to have better protected jobs.

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Bibliographic Info

Paper provided by Tilburg University in its series Open Access publications from Tilburg University with number urn:nbn:nl:ui:12-194309.

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Date of creation: 2007
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Publication status: Published in Economica (2007) v.74, p.381-396
Handle: RePEc:ner:tilbur:urn:nbn:nl:ui:12-194309

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Web page: http://www.tilburguniversity.edu/

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  1. Ricardo J. Caballero & Mohamad L. Hammour, 1996. "The Macroeconomics of Specificity," NBER Working Papers 5757, National Bureau of Economic Research, Inc.
  2. Belot, M.V.K. & Ours, J.C. van, 2001. "Unemployment and Labor Market Institutions: An Empirical Analysis," Discussion Paper, Tilburg University, Center for Economic Research 2001-50, Tilburg University, Center for Economic Research.
  3. Peter Rühmann & Jens Südekum, 2001. "Severance Payments and Firm-Specific Human Capital," Departmental Discussion Papers, University of Goettingen, Department of Economics 111, University of Goettingen, Department of Economics.
  4. bertola, G. & Rogerson, R., 1996. "Institutions and Labor Reallocation," Papers, Banca Italia - Servizio di Studi 272, Banca Italia - Servizio di Studi.
  5. Wasmer, Etienne, 2002. "Interpreting Europe and US labor markets differences: the specificity of human capital investments," Arbetsrapport, Institute for Futures Studies 2003:9, Institute for Futures Studies.
  6. Kuhn, Peter, 1992. "Mandatory Notice," Journal of Labor Economics, University of Chicago Press, University of Chicago Press, vol. 10(2), pages 117-37, April.
  7. Dale T. Mortensen & Christopher A. Pissarides, 1993. "Job Creation and Job Destruction in the Theory of Unemployment," CEP Discussion Papers, Centre for Economic Performance, LSE dp0110, Centre for Economic Performance, LSE.
  8. Teulings,Coen & Hartog,Joop, 1998. "Corporatism or Competition?," Cambridge Books, Cambridge University Press, Cambridge University Press, number 9780521590730.
  9. Hosios, Arthur J, 1990. "On the Efficiency of Matching and Related Models of Search and Unemployment," Review of Economic Studies, Wiley Blackwell, Wiley Blackwell, vol. 57(2), pages 279-98, April.
  10. Nickell, Stephen & Layard, Richard, 1999. "Labor market institutions and economic performance," Handbook of Labor Economics, Elsevier, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 46, pages 3029-3084 Elsevier.
  11. Hopenhayn, Hugo & Rogerson, Richard, 1993. "Job Turnover and Policy Evaluation: A General Equilibrium Analysis," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 101(5), pages 915-38, October.
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