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Firing Notification Procedures and Wage Growth

Author

Listed:
  • Anthony Terriau

    (GAINS - Groupe d'Analyse des Itinéraires et des Niveaux Salariaux - UM - Le Mans Université)

  • Nicolae Stef

    (GAINS - Groupe d'Analyse des Itinéraires et des Niveaux Salariaux - UM - Le Mans Université)

Abstract

We investigate how firing notification procedures influence wage growth. Using a sample of 33 countries over the period 2006–2015, we show that administrative requirements in cases of dismissal have a positive and significant effect on wage growth. The result is robust even after controlling for the endogeneity of the firing notification restrictions, the involvement of third parties in the wage bargaining process, the minimum wage, the firms' training policy, and the composition of employment. These findings suggest that firing notification procedures foster the growth of wages by increasing the bargaining power of incumbent workers.

Suggested Citation

  • Anthony Terriau & Nicolae Stef, 2023. "Firing Notification Procedures and Wage Growth," Post-Print hal-05470203, HAL.
    • Handle: RePEc:hal:journl:hal-05470203
    DOI: 10.1108/S0193-589520240000031006
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