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Job protection, housing market regulation, and the youth

Author

Listed:
  • Antoine Bonleu
  • Bruno Decreuse
  • Tanguy van Ypersele

Abstract

Young Europeans experience high unemployment rates, job instability, and late emancipation. Meanwhile, they do not support reforms weakening protection on long‐term contracts. In this paper, we suggest a possible rationale for such reform distaste. When the rental market is strongly regulated, landlords screen applicants with regard to their ability to pay the rent. Protecting regular jobs offers a second‐best technology to sort workers, thereby increasing the rental market size. We provide a model where nonemployed workers demand protected jobs despite unemployment and the share of short‐term jobs increases, whereas the individual risk of dismissal is unaffected. Our theory can be extended to alternative risks and markets involving correlated risks and commitment under imperfect information.

Suggested Citation

  • Antoine Bonleu & Bruno Decreuse & Tanguy van Ypersele, 2019. "Job protection, housing market regulation, and the youth," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 21(6), pages 1017-1036, December.
    • Handle: RePEc:bla:jpbect:v:21:y:2019:i:6:p:1017-1036
    DOI: 10.1111/jpet.12323
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    Cited by:

    1. is not listed on IDEAS
    2. Berson, C. & Malgouyres, C. & Ray, S., 2017. "Marché du travail : institutions et réformes - Synthèse de la cinquième conférence annuelle sur le marché du travail des 1er et 2 décembre 2016 organisée à Aix-en-Provence par l’École d’économie d’Aix," Bulletin de la Banque de France, Banque de France, issue 210, pages 71-78.
    3. repec:bfr:quarte:2016:45:06 is not listed on IDEAS
    4. C. Devillers & K. Parra Ramirez, 2017. "French Banks confirm their fourth rank in international banking," Quarterly selection of articles - Bulletin de la Banque de France, Banque de France, issue 45, pages 31-44, Spring.
    5. repec:bfr:quarte:2016:45:03 is not listed on IDEAS
    6. B. Bureau & M. Bürker & T. Libert, 2017. "The financial situation of companies in France in 2015," Quarterly selection of articles - Bulletin de la Banque de France, Banque de France, issue 45, pages 53-69, Spring.
    7. repec:bfr:quarte:2016:45:05 is not listed on IDEAS
    8. A. Lalliard, 2017. "An alternative method for capturing tensions in the residential property market," Quarterly selection of articles - Bulletin de la Banque de France, Banque de France, issue 45, pages 5-13, Spring.
    9. repec:bfr:quarte:2016:45:01 is not listed on IDEAS
    10. L. Ferrara & G. Gauthier & F. Pappadà, 2017. "Fiscal consolidation episodes in OECD countries: the role of tax compliance and fiscal space," Quarterly selection of articles - Bulletin de la Banque de France, Banque de France, issue 45, pages 15-22, Spring.
    11. W. Arrata & A. Gautier & P. Lopez & I. Rahmouni-Rousseau & M. Girotti & B. Mojon & U. Szczerbowicz & M. Vari & T. Foucault, 2017. "12th Annual Central Bank Workshop on the Microstructure of Financial Markets 29-30 September 2016, Banque de France (Non-technical summary)," Quarterly selection of articles - Bulletin de la Banque de France, Banque de France, issue 45, pages 23-30, Spring.
    12. repec:bfr:quarte:2016:45:02 is not listed on IDEAS
    13. repec:bfr:quarte:2016:45:04 is not listed on IDEAS

    More about this item

    JEL classification:

    • R2 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis
    • K31 - Law and Economics - - Other Substantive Areas of Law - - - Labor Law

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