Can employment subsidies and greater labour market flexibility increase job opportunities for youth? Revisiting the Italian On-the-job Training Program
AbstractThe CFL (On-the-job Training) programme was introduced in Italy in 1985 with the aim of reducing youth unemployment. The new programme offered employers two main advantages: it exempted them almost completely from payment of payroll taxes and it provided them with virtually the only opportunity to employ people on a basis of fixed term contracts. The paper looks at the employment impact of the programme among a subgroup of eligible workers and finds that firms taking part increased employment more than non-participating firms by almost 5%. Employers had a strong positive reaction to the tax subsidies and to the softening of the rigid employment code. The overall effect of the programme on youth employment was however limited, registering only a 1% increase, mainly because about 80% of firms never participated.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 10370.
Date of creation: Jul 2008
Date of revision:
Labour Policy Evaluation; Youth Unemployment; Occupation and Intergenerational Mobility; Unemployment;
Other versions of this item:
- Tattara, Giuseppe & Valentini, Marco, 2009. "Can employment subsidies and greater labour market flexibility increase job opportunities for youth? : revisiting the Italian on-the-job training programme," Zeitschrift für ArbeitsmarktForschung - Journal for Labour Market Research, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany], vol. 42(3), pages 197-212.
- J63 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - Turnover; Vacancies; Layoffs
- J41 - Labor and Demographic Economics - - Particular Labor Markets - - - Labor Contracts
- J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
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