IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this article or follow this journal

Employment Protection Regulations and Their Impact on Employment

  • Wolfgang Pointner

    ()

    (Oesterreichische Nationalbank)

Registered author(s):

    Employment protection legislation (EPL) forms part of the institutional framework governing labor market allocation processes. It increases the costs enterprises incur when terminating contracts, either directly via severance payments or indirectly via procedural costs (e.g. notice periods or court trials). EPL is often considered to be the main reason for the high unemployment level in several euro area countries. While the empirical evidence for this correlation is generally rather weak, more robust results are found for its adverse impact on the employment opportunities of certain sociodemographic groups – especially women and the young. Another means to reduce the income risk associated with job loss are unemployment insurance benefits, which – contrary to employment protection – do not affect the employment opportunities of specific sociodemographic groups. An analysis of the effects of EPL on employment certainly needs to take into consideration other labor market institutions, too, as they are often highly correlated and their effects interact. Insofar as employment protection not only stabilizes the protected employees’ income, but also serves as an incentive to acquire firm-specific human capital, a certain degree of employment protection can also contribute to gross domestic product (GDP) growth.

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

    File URL: http://www.oenb.at/dms/oenb/Publikationen/Volkswirtschaft/Monetary-Policy-and-the-Economy/2006/Monetary-Policy-and-the-Economy-Q3-06/chapters/mop_2006_3_pointner_tcm16-48471.pdf
    Download Restriction: no

    Article provided by Oesterreichische Nationalbank (Austrian Central Bank) in its journal Monetary Policy & the Economy.

    Volume (Year): (2006)
    Issue (Month): 3 ()
    Pages: 44–57

    as
    in new window

    Handle: RePEc:onb:oenbmp:y:2006:i:3:b:3
    Contact details of provider: Postal: P.O. Box 61, A-1011 Vienna, Austria
    Phone: +43/1/404 20 7405
    Fax: +43/1/404 20 7499
    Web page: http://www.oenb.at
    Email:


    More information through EDIRC

    Order Information: Postal: Oesterreichische Nationalbank, Documentation Management and Communications Services, Otto-Wagner Platz 3, A-1090 Vienna, Austria
    Email:


    References listed on IDEAS
    Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

    as in new window
    1. Gilles Saint Paul, 1999. "The political economy of employment protection," Economics Working Papers 355, Department of Economics and Business, Universitat Pompeu Fabra.
    2. Andrew E. Clark & Fabien Postel-Vinay, 2004. "Job security and job protection," DELTA Working Papers 2004-16, DELTA (Ecole normale supérieure).
    3. Olivier Blanchard, 2005. "European Unemployment: The Evolution of Facts and Ideas," NBER Working Papers 11750, National Bureau of Economic Research, Inc.
    4. Algan, Yann & Cahuc, Pierre, 2005. "Civic attitudes and the Design of Labor Market Institutions? Which Countries can Implement the Danish Flexicurity Model?," CEPREMAP Working Papers (Docweb) 0517, CEPREMAP.
    5. Andrea Ichino & Michele Polo & Enrico Rettore, . "Are Judges Biased by Labor Market Conditions?," Working Papers 192, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University.
    6. Agell, Jonas, 2001. "On the Determinants of Labour Market Institutions: Rent Seeking vs. Social Insurance," Research Papers in Economics 2001:12, Stockholm University, Department of Economics.
    7. Richard B. Freeman, 2005. "Labour Market Institutions Without Blinders: The Debate over Flexibility and Labour Market Performance," NBER Working Papers 11286, National Bureau of Economic Research, Inc.
    8. Wolfgang Ochel, 2004. "Lernen von anderen Ländern: Zum internationalen Vergleich und Transfer von Arbeitsmarktinstitutionen," Perspektiven der Wirtschaftspolitik, Verein für Socialpolitik, vol. 5(2), pages 139-158, 05.
    9. Addison, John T. & Teixeira, Paulino, 2001. "The Economics of Employment Protection," IZA Discussion Papers 381, Institute for the Study of Labor (IZA).
    10. Olivier Blanchard & Justin Wolfers, 1999. "The Role of Shocks and Institutions in the Rise of European Unemployment: The Aggregate Evidence," NBER Working Papers 7282, National Bureau of Economic Research, Inc.
    11. Susan N. Houseman & Katharine G. Abraham, 1994. "Labor Adjustment Under Different Institutional Structures: A Case Study of Germany and the United States," Upjohn Working Papers and Journal Articles 94-26, W.E. Upjohn Institute for Employment Research.
    12. Di Tella, Rafael & MacCulloch, Robert, 2005. "The consequences of labor market flexibility: Panel evidence based on survey data," European Economic Review, Elsevier, vol. 49(5), pages 1225-1259, July.
    13. Pierre Cahuc & André Zylberberg, 2004. "Labor Economics," MIT Press Books, The MIT Press, edition 1, volume 1, number 026203316x, June.
    14. bertola, G. & Rogerson, R., 1996. "Institutions and Labor Reallocation," Papers 272, Banca Italia - Servizio di Studi.
    15. Alfonso Arpaia & Gilles Mourre, 2005. "Labour Market Institutions and Labour Market Performance: A Survey of the Literature," Labor and Demography 0512011, EconWPA.
    16. Lazear, Edward P, 1990. "Job Security Provisions and Employment," The Quarterly Journal of Economics, MIT Press, vol. 105(3), pages 699-726, August.
    17. Field, Alexander J., 1991. "Institutions, Institutional Change and Economic Performance. By Douglass C. North. Cambridge: Cambridge University Press, 1990. Pp. viii, 152. $32.50, cloth; $10.95, paper," The Journal of Economic History, Cambridge University Press, vol. 51(04), pages 999-1001, December.
    Full references (including those not matched with items on IDEAS)

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    When requesting a correction, please mention this item's handle: RePEc:onb:oenbmp:y:2006:i:3:b:3. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Claudia Kwapil)

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.