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Are Temporary Workers Discriminated Against? Evidence from Europe

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  • Simona COMI

    ()

  • Mara GRASSENI

Abstract

The aim of this paper is to analyse the wage gap between temporary and permanent jobs in 12 European countries. We use the semi-parametric (quantile regression) approach and evaluate the wage gap across the entire wage distribution. We show that the fixed-term wage gap decreases as higher quantiles are considered, and that having a fixed-term contract penalizes low–skilled workers (at the bottom of the earnings distribution) more than high–skilled ones. Finally, we decompose the wage differential across the entire wage distribution in order to account for the relative importance of observed characteristics versus different returns to skills. We find that workers with the same characteristics as temporary workers would receive higher wages if they worked on permanent contracts in almost all the countries considered, and that this finding is stable across? the entire wage distribution.

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File URL: http://www.child-centre.unito.it/papers/child17_2009.pdf
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Bibliographic Info

Paper provided by CHILD - Centre for Household, Income, Labour and Demographic economics - ITALY in its series CHILD Working Papers with number wp17_09.

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Length: 33 pages
Date of creation: Jul 2009
Date of revision:
Handle: RePEc:wpc:wplist:wp17_09

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Keywords: Temporary jobs; fixed-term contracts; wage differentials; quantile regression; decomposition.;

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References

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  1. DiNardo, John & Fortin, Nicole M & Lemieux, Thomas, 1996. "Labor Market Institutions and the Distribution of Wages, 1973-1992: A Semiparametric Approach," Econometrica, Econometric Society, vol. 64(5), pages 1001-44, September.
  2. Koutentakis, Franciscos, 2008. "The effect of temporary contracts on job security of permanent workers," Economics Letters, Elsevier, vol. 101(3), pages 220-222, December.
  3. Albrecht, James & Björklund, Anders & Vroman, Susan, 2001. "Is There a Glass Ceiling in Sweden?," IZA Discussion Papers 282, Institute for the Study of Labor (IZA).
  4. Rebitzer, James B & Taylor, Lowell J, 1991. "A Model of Dual Labor Markets When Product Demand Is Uncertain," The Quarterly Journal of Economics, MIT Press, vol. 106(4), pages 1373-83, November.
  5. Koenker, Roger W & Bassett, Gilbert, Jr, 1978. "Regression Quantiles," Econometrica, Econometric Society, vol. 46(1), pages 33-50, January.
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Cited by:
  1. Colella, Fabrizio, 2014. "Women's Part-Time - Full-Time Wage Differentials in Europe: an Endogenous Switching Model," MPRA Paper 55287, University Library of Munich, Germany.
  2. Garcia Cruz, Gustavo Adolfo, 2014. "Labor Informality: Choice or Sign of Segmentation? A Quantile Regression Approach at the Regional Level for Colombia," MPRA Paper 55224, University Library of Munich, Germany.
  3. Ramos, Raul & Sanromá, Esteban & Simón, Hipólito, 2014. "Public-Private Sector Wage Differentials by Type of Contract: Evidence from Spain," IZA Discussion Papers 8158, Institute for the Study of Labor (IZA).
  4. Gabriele Ballarino & Michela Braga & Massimiliano Bratti & Daniele Checchi & Antonio Filippin & Carlo V. Fiorio & Marco Leonardi & Elena Meschi & Francesco Scervini, 2013. "GINI Country Report: Growing Inequalities and their Impacts in Italy," GINI Country Reports italy, AIAS, Amsterdam Institute for Advanced Labour Studies.
  5. Carmen Aina & Fernanda Mazzotta & Lavinia Parisi, 2010. "Do Flexible Employment Contracts Change Household Income Differences in Italy?," Working Papers 129, SEMEQ Department - Faculty of Economics - University of Eastern Piedmont.
  6. Christoph Ehlert & Sandra Schaffner, 2011. "Health Effects of Temporary Jobs in Europe," Ruhr Economic Papers 0295, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen.

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