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How Does Employment Protection Legislation Affect Unemployment in Tunisia? A Search Equilibrium Approach

Author

Listed:
  • Domenico Fanizza
  • Taline Koranchelian

Abstract

This paper applies a search matching model with firing restrictions to examine whether the existence of firing restrictions affects the outcome of the matching process and the natural rate of unemployment in Tunisia. The paper concludes that the removal of firing restrictions is likely to produce a favorable but limited impact on unemployment in Tunisia.

Suggested Citation

  • Domenico Fanizza & Taline Koranchelian, 2005. "How Does Employment Protection Legislation Affect Unemployment in Tunisia? A Search Equilibrium Approach," IMF Working Papers 05/92, International Monetary Fund.
  • Handle: RePEc:imf:imfwpa:05/92
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    References listed on IDEAS

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    1. Bertola, Giuseppe, 1990. "Job security, employment and wages," European Economic Review, Elsevier, vol. 34(4), pages 851-879, June.
    2. Kugler, Adriana & Pica, Giovanni, 2003. "Effects of Employment Protection and Product Market Regulations on the Italian Labor Market," IZA Discussion Papers 948, Institute for the Study of Labor (IZA).
    3. Mortensen, Dale & Pissarides, Christopher, 2011. "Job Creation and Job Destruction in the Theory of Unemployment," Economic Policy, Russian Presidential Academy of National Economy and Public Administration, vol. 1, pages 1-19.
    4. Burda, Michael C, 1992. " A Note on Firing Costs and Severance Benefits in Equilibrium Unemployment," Scandinavian Journal of Economics, Wiley Blackwell, vol. 94(3), pages 479-489.
    5. Fanizza, Domenico, 1996. "Employment cycles in search equilibrium," Journal of Economic Dynamics and Control, Elsevier, vol. 20(5), pages 879-904, May.
    6. Diamond, Peter A., 1971. "A model of price adjustment," Journal of Economic Theory, Elsevier, vol. 3(2), pages 156-168, June.
    7. Bentolila, Samuel & Saint-Paul, Gilles, 1992. "The macroeconomic impact of flexible labor contracts, with an application to Spain," European Economic Review, Elsevier, vol. 36(5), pages 1013-1047, June.
    8. Pissarides, Christopher A, 1999. "Policy Influences on Unemployment: The European Experience," Scottish Journal of Political Economy, Scottish Economic Society, vol. 46(4), pages 389-418, September.
    9. Garibaldi, Pietro, 1998. "Job flow dynamics and firing restrictions," European Economic Review, Elsevier, vol. 42(2), pages 245-275, February.
    10. Nickell, Stephen J, 1982. "The Determinants of Equilibrium Unemployment in Britain," Economic Journal, Royal Economic Society, vol. 92(367), pages 555-575, September.
    11. Samuel Bentolila & Giuseppe Bertola, 1990. "Firing Costs and Labour Demand: How Bad is Eurosclerosis?," Review of Economic Studies, Oxford University Press, vol. 57(3), pages 381-402.
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    Cited by:

    1. Independent Evaluation Group, 2009. "Earnings Growth and Employment Creation," World Bank Publications, The World Bank, number 24116.

    More about this item

    Keywords

    Unemployment; Wages; Tunisia; Firing restrictions; job search; matching model; job creation; employment; labor market; jobs; Unemployment: Models; Duration; Incidence; and Job Search;

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