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Temporary Contracts and Employee Effort

  • Engellandt, Axel

    ()

    (University of Basel)

  • Riphahn, Regina T.

    ()

    (University of Erlangen-Nuremberg)

Temporary contracts provide employers with a tool to screen potential new employees and have been shown to provide "stepping stones" into permanent employment for workers. For both reasons workers on temporary contracts have an incentive to provide more effort than permanent employees. Using indicators for unpaid overtime work and absences taken from the Swiss Labor Force Survey we present evidence that temporary workers indeed provide higher effort than permanent employees: Their probability of working unpaid overtime exceeds that of permanently employed workers by 60 percent. We show the heterogeneity of this effect across different types of temporary contracts, investigate differences between men and women, and discuss the relevance of adverse selection into temporary employment.

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File URL: http://ftp.iza.org/dp780.pdf
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Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 780.

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Length: 28 pages
Date of creation: May 2003
Date of revision:
Publication status: published in: Labour Economics, 2005, 12 (3), 281-299
Handle: RePEc:iza:izadps:dp780
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  1. Bertil Holmlund & Donald Storrie, 2002. "Temporary Work in Turbulent Times: The Swedish Experience," CESifo Working Paper Series 671, CESifo Group Munich.
  2. O Blanchard & A Landier, 2002. "The Perverse Effects of Partial Labour Market Reform: fixed--Term Contracts in France," Economic Journal, Royal Economic Society, vol. 112(480), pages F214-F244, June.
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  5. Gibbons, R. & Murphy, K.J., 1990. "Optimal Incentive Contracts In The Presence Of Career Concerns: Theory And Evidence," Working papers 563, Massachusetts Institute of Technology (MIT), Department of Economics.
  6. Daniel S. Nagin & James B. Rebitzer & Seth Sanders & Lowell J. Taylor, 2002. "Monitoring, Motivation, and Management: The Determinants of Opportunistic Behavior in a Field Experiment," American Economic Review, American Economic Association, vol. 92(4), pages 850-873, September.
  7. Ichino, Andrea & Riphahn, Regina, 2003. "The Effect of Employment Protection on Worker Effort: A Comparison of Absenteeism During and After Probation," CEPR Discussion Papers 3847, C.E.P.R. Discussion Papers.
  8. Cahuc, Pierre & Postel-Vinay, Fabien, 2001. "Temporary Jobs, Employment Protection and Labor Market Performance," IZA Discussion Papers 260, Institute for the Study of Labor (IZA).
  9. Michael D. S. Morris & Alexander Vekker, 2001. "An Alternative Look at Temporary Workers, Their Choices, and the Growth in Temporary Employment," Journal of Labor Research, Transaction Publishers, vol. 22(2), pages 373-390, April.
  10. Johansson, Per & Palme, Mårten, 2001. "Assessing the effect of public policy on worker absenteeism," Working Paper Series 2002:13, IFAU - Institute for Evaluation of Labour Market and Education Policy.
  11. 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).
  12. María Guadalupe, 2002. "The Hidden Costs of Fixed Term Contracts: the Impact On Work Accidents," CEP Discussion Papers dp0551, Centre for Economic Performance, LSE.
  13. Juan José Dolado & Carlos García-Serrano & Juan F. Jimeno, . "Drawing Lessons from the Boom of Temporary Jobs in Spain," Working Papers 2001-11, FEDEA.
  14. Landers, Renee M & Rebitzer, James B & Taylor, Lowell J, 1996. "Rat Race Redux: Adverse Selection in the Determination of Work Hours in Law Firms," American Economic Review, American Economic Association, vol. 86(3), pages 329-48, June.
  15. Booth, Alison L. & Francesconi, Marco & Frank, Jeff, 2003. "A sticky floors model of promotion, pay, and gender," European Economic Review, Elsevier, vol. 47(2), pages 295-322, April.
  16. Johansson, Per & Palme, Marten, 1996. "Do economic incentives affect work absence? Empirical evidence using Swedish micro data," Journal of Public Economics, Elsevier, vol. 59(2), pages 195-218, February.
  17. Alison L Booth & Juan J. Dolado & Jeff Frank, 2002. "Symposium On Temporary Work Introduction," Economic Journal, Royal Economic Society, vol. 112(480), pages F181-F188, June.
  18. Lewis M. Segal & Daniel G. Sullivan, 1997. "The Growth of Temporary Services Work," Journal of Economic Perspectives, American Economic Association, vol. 11(2), pages 117-136, Spring.
  19. Barmby, Tim & Orme, Chris D & Treble, John, 1990. "Worker Absenteeism: An Analysis Using Microdata," CEPR Discussion Papers 434, C.E.P.R. Discussion Papers.
  20. Regina T. Riphahn & Anja Thalmaier, 2001. "Behavioral Effects of Probation Periods: An Analysis of Worker Absenteeism," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), Justus-Liebig University Giessen, Department of Statistics and Economics, vol. 221(2), pages 179-201.
  21. Booth, Alison L. & Francesconi, Marco & Frank, Jeff, 2002. "Labour as a buffer: do temporary workers suffer?," ISER Working Paper Series 2002-29, Institute for Social and Economic Research.
  22. Barmby, Tim, 2002. "Worker absenteeism: a discrete hazard model with bivariate heterogeneity," Labour Economics, Elsevier, vol. 9(4), pages 469-476, September.
  23. Hagen, Tobias, 2003. "Do Fixed-Term Contracts Increase the Long-Term Employment Opportunities of the Unemployed?," ZEW Discussion Papers 03-49, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  24. Lazear, Edward P & Rosen, Sherwin, 1990. "Male-Female Wage Differentials in Job Ladders," Journal of Labor Economics, University of Chicago Press, vol. 8(1), pages S106-23, January.
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