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Job Security Legislation and Job Duration: Evidence from the United Kingdom

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  • Ioana Marinescu

Abstract

Even in countries with high average job security, workers with low tenure typically enjoy very limited job protection. This study analyzes the impact of such a feature on job duration. It uses a 1999 British reform that increased job security for workers with 1-2 years of tenure. The firing hazard for these workers decreased by 26% relative to the hazard for workers with 2-4 years of tenure. The firing hazard for workers with 0-1 year of tenure also decreased by 19%, which is consistent with better recruitment practices and hence improved match quality. (c) 2009 by The University of Chicago.

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  • Ioana Marinescu, 2009. "Job Security Legislation and Job Duration: Evidence from the United Kingdom," Journal of Labor Economics, University of Chicago Press, vol. 27(3), pages 465-486, July.
  • Handle: RePEc:ucp:jlabec:v:27:y:2009:i:3:p:465-486
    DOI: 10.1086/603643
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    References listed on IDEAS

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    Cited by:

    1. Laeven, Luc & McAdam, Peter & Popov, Alexander, 2018. "Credit Shocks, Employment Protection, and Growth: Firm-level Evidence from Spain," CEPR Discussion Papers 13026, C.E.P.R. Discussion Papers.
    2. Bassanini, Andrea & Garnero, Andrea, 2013. "Dismissal protection and worker flows in OECD countries: Evidence from cross-country/cross-industry data," Labour Economics, Elsevier, vol. 21(C), pages 25-41.
    3. Lawrence M. Kahn, 2012. "Labor market policy: A comparative view on the costs and benefits of labor market flexibility," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 31(1), pages 94-110, December.
    4. Cervini-Plá, María & Ramos, Xavier & Ignacio Silva, José, 2014. "Wage effects of non-wage labour costs," European Economic Review, Elsevier, vol. 72(C), pages 113-137.
    5. Henri Fraisse & Francis Kramarz & Corinne Prost, 2015. "Labor Disputes and Job Flows," ILR Review, Cornell University, ILR School, vol. 68(5), pages 1043-1077, October.
    6. Cyprien Batut & Eric Maurin, 2020. "Termination of Employment Contracts by Mutual Consent and Labor Market Fluidity," IAAEU Discussion Papers 202005, Institute of Labour Law and Industrial Relations in the European Union (IAAEU).
    7. O’Higgins Niall & Pica Giovanni, 2020. "Complementarities between Labour Market Institutions and their Causal Impact on Youth Labour Market Outcomes," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 20(3), pages 1-37, July.
    8. Marinescu, Ioana, 2016. "Divorce: What does learning have to do with it?," Labour Economics, Elsevier, vol. 38(C), pages 90-105.
    9. Boeri, Tito & Garibaldi, Pietro, 2019. "A tale of comprehensive labor market reforms: Evidence from the Italian jobs act," Labour Economics, Elsevier, vol. 59(C), pages 33-48.
    10. Fu, Hu & Kleinberg, Robert & Lavi, Ron & Smorodinsky, Rann, 2017. "Job security, stability and production efficiency," Theoretical Economics, Econometric Society, vol. 12(1), January.
    11. Per Skedinger, 2010. "Employment Protection Legislation," Books, Edward Elgar Publishing, number 13686, September.
    12. Moro, Andrea & Maresch, Daniela & Ferrando, Annalisa & Udell, Gregory F., 2017. "Does employment protection legislation affect credit access? Evidence from Europe," Working Paper Series 2063, European Central Bank.
    13. Batut, Cyprien & Maurin, Eric, 2019. "From Ultima Ratio to Mutual Consent: The Effects of Changing Employment Protection Doctrine," IZA Discussion Papers 12440, Institute of Labor Economics (IZA).
    14. Dräger, Vanessa, 2015. "Do Employment Protection Reforms Affect Well-Being?," IZA Discussion Papers 9114, Institute of Labor Economics (IZA).
    15. Federico Cingano & Marco Leonardi & Julián Messina & Giovanni Pica, 2016. "Employment Protection Legislation, Capital Investment and Access to Credit: Evidence from Italy," Economic Journal, Royal Economic Society, vol. 126(595), pages 1798-1822, September.
    16. Lembcke, Alexander, 2014. "The impact of mandatory entitlement to paid leave on employment in the UK," LSE Research Online Documents on Economics 60270, London School of Economics and Political Science, LSE Library.
    17. Anderton, Robert & Di Lupidio, Benedetta, 2019. "Effects of labour and product market regulation on worker flows: evidence for the euro area using micro data," Working Paper Series 2312, European Central Bank.
    18. Okudaira, Hiroko, 2018. "The economic costs of court decisions concerning dismissals in Japan: Identification by judge transfers," International Review of Law and Economics, Elsevier, vol. 53(C), pages 60-75.
    19. Jose Garcia-Louzao, 2020. "Workers' Job Mobility in Response to Severance Pay Generosity," Bank of Lithuania Working Paper Series 76, Bank of Lithuania.

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