Temporary Jobs and State Dependence in Italy
A dynamic unobserved effects probit analysis has been carried out to test the hypothesis of state dependence of temporary jobs and to understand their determinants. The econometric analysis has been conducted using the 2000, 2002, and 2004 waves of the Survey of Italian Households' Income and Wealth. The results show that, firstly, jobless and unstable workers are more likely to end up in temporary contracts. Secondly, there is a significant true state dependence effect of temporary contracts that might be due to the fact that firms are systematically using temporary jobs to face demand uncertainty: loss of motivation and depreciation of human capital due to low firm-specific investments may make temporary workers less likely to jump on stabler job relationships. Moreover, the true state dependence could be related to the presence of a dual labour market, segmented into "bad" and "good" jobs. Thirdly, a significant feedback effect from past temporary jobs to recent unemployment spells has been detected. Therefore, jobless and unstable workers are more likely to end up into temporary relationship generating a loss of human capital, affecting the workers' allocation in the whole economy, and widening the gap between possibly segmented labour markets. The policy maker might be aware of these costs associated to the widespread of temporary jobs and design policies to target those workers suffering most from the trap of temporary positions.
|Date of creation:||Oct 2006|
|Contact details of provider:|| Postal: Piazzale Martelli, 8, 60121 Ancona|
Phone: +39 071 220 7100
Fax: +39 071 220 7102
Web page: http://www.dises.univpm.it/
More information through EDIRC
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.:
- Matteo, PICCHIO, 2006. "Wage Differentials and Temporary Jobs in Italy," Discussion Papers (ECON - Département des Sciences Economiques) 2006033, Université catholique de Louvain, Département des Sciences Economiques.
- Gagliarducci, Stefano, 2005. "The dynamics of repeated temporary jobs," Labour Economics, Elsevier, vol. 12(4), pages 429-448, August.
- Wooldridge, Jeffrey M., 2000. "A framework for estimating dynamic, unobserved effects panel data models with possible feedback to future explanatory variables," Economics Letters, Elsevier, vol. 68(3), pages 245-250, September.
- Alison L. Booth & Marco Francesconi & Jeff Frank, 2002.
"Temporary Jobs: Stepping Stones Or Dead Ends?,"
Royal Economic Society, vol. 112(480), pages 189-213, June.
- Booth, Alison L. & Francesconi, Marco & Frank, Jeff, 2000. "Temporary Jobs: Stepping Stones or Dead Ends?," IZA Discussion Papers 205, Institute for the Study of Labor (IZA).
- Alison L. Booth & Marco Francesconi & Jeff Frank, 2002. "Temporary Jobs: Stepping Stones or Dead Ends?," LABORatorio R. Revelli Working Papers Series 8, LABORatorio R. Revelli, Centre for Employment Studies.
- Andrea Ichino & Fabrizia Mealli & Tommaso Nannicini, 2005. "Temporary Work Agencies in Italy: A Springboard Toward Permanent Employment?," Giornale degli Economisti, GDE (Giornale degli Economisti e Annali di Economia), Bocconi University, vol. 64(1), pages 1-27, September.
- Matteo PICCHIO, 2006. "Wage Differentials between Temporary and Permanent Workers in Italy," Working Papers 257, Universita' Politecnica delle Marche (I), Dipartimento di Scienze Economiche e Sociali.
- Biewen, Martin, 2004. "Measuring State Dependence in Individual Poverty Status: Are There Feedback Effects to Employment Decisions and Household Composition?," IZA Discussion Papers 1138, Institute for the Study of Labor (IZA).
- Martin Biewen, 2004. "Measuring State Dependence in Individual Poverty Status: Are there Feedback Effects to Employment Decisions and Household Composition?," Discussion Papers of DIW Berlin 429, DIW Berlin, German Institute for Economic Research.
- Juan F. Jimeno & Luis Toharia, 1993. "The effects of fixed-term employment on wages: theory and evidence from Spain," Investigaciones Economicas, Fundación SEPI, vol. 17(3), pages 475-494, September. Full references (including those not matched with items on IDEAS)