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Bargaining and Temporary Employment

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Author Info
Dimitri Paolini

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Abstract

This article studies the behavior of the …rm when it is searching to …ll a vacancy. The principal hypothesis is that the …rm can o¤er two kinds of contracts to the workers, short-term or long-term contracts. The short-term contract is like a probationary stage in which the …rm can learn the worker’s type. After this stage the …rm can propose a long-term contract to the worker, or it can decide to …nd another worker. We suppose that the …rm and the worker bargain over the wage of both types of contract, and that the worker’s bargaining power is di¤erent according to the type of contract. We utilize this framework to study the …rms’ optimal policy choice and its welfare implications.

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Paper provided by Centre de Recherche en Economie Publique et de la Population (CREPP) (Research Center on Public and Population Economics) HEC-Management School, University of Liège in its series CREPP Working Papers with number 0107.

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Date of creation: 2001
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Handle: RePEc:rpp:wpaper:0107

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  1. Cahuc, Pierre & Postel-Vinay, Fabien, 2002. "Temporary jobs, employment protection and labor market performance," Labour Economics, Elsevier, vol. 9(1), pages 63-91, February. [Downloadable!] (restricted)
  2. Jovanovic, Boyan, 1984. "Matching, Turnover, and Unemployment," Journal of Political Economy, University of Chicago Press, vol. 92(1), pages 108-22, February. [Downloadable!] (restricted)
  3. Acemoglu, Daron, 2001. "Good Jobs versus Bad Jobs," Journal of Labor Economics, University of Chicago Press, vol. 19(1), pages 1-21, January. [Downloadable!] (restricted)
  4. Marimon, Ramon & Zilibotti, Fabrizio, 1999. "Unemployment vs. Mismatch of Talents: Reconsidering Unemployment Benefits," Economic Journal, Royal Economic Society, vol. 109(455), pages 266-91, April. [Downloadable!] (restricted)
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  5. Diamond, Peter A, 1982. "Wage Determination and Efficiency in Search Equilibrium," Review of Economic Studies, Blackwell Publishing, vol. 49(2), pages 217-27, April. [Downloadable!] (restricted)
  6. Alison L. Booth & Marco Francesconi & Jeff Frank, 2000. "Temporary Jobs: Who gets them, what are they worth, and do they lead anywhere?," ILR working papers 054, Institute for Labour Research. [Downloadable!]
  7. Jovanovic, Boyan, 1979. "Job Matching and the Theory of Turnover," Journal of Political Economy, University of Chicago Press, vol. 87(5), pages 972-90, October. [Downloadable!] (restricted)
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  8. Bentolila, Samuel & Saint-Paul, Gilles, 1992. "The macroeconomic impact of flexible labor contracts, with an application to Spain," European Economic Review, Elsevier, vol. 36(5), pages 1013-1047, June. [Downloadable!] (restricted)
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