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Factors Affecting Quits and Layoffs in Spanish Labour Market

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  • Caparros, A.
  • Navarro, M.L.

Abstract

During the last decade, unemployment rates in the European Union have been higher than in other regions, e.g., the United States, and these are even higher in Spain. It has been argued that the different degrees of labour mobility between the European and the American labour markets can account for the differences in the pattern observed. This paper follows the McLaughlin's model (1991) and provides empirical evidence regarding the factors determining quits and layoffs due to contract termination and non-renewal in Spain, following the efficient-turnover theory and wage flexibility. The data was obtained from the Spanish Household Panel Survey (PHOGUE) conducted by the Instituto Nacional de Estadística (INE 1995). Our evidence, on the one hand, indicates that workers' characteristics influence on the probability of changing job. On the other hand, the influency of the factors affecting labour mobility is different depending on whether job separation was triggered by quits or layoffs.

Suggested Citation

  • Caparros, A. & Navarro, M.L., 2005. "Factors Affecting Quits and Layoffs in Spanish Labour Market," Applied Econometrics and International Development, Euro-American Association of Economic Development, vol. 5(4).
    • Handle: RePEc:eaa:aeinde:v:5:y:2005:i:4_3
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    More about this item

    Keywords

    quit; layoff; wage revision and bivariate probit;
    All these keywords.

    JEL classification:

    • J63 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Turnover; Vacancies; Layoffs
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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