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Labour Courts delays and the composition of employment: Is labour encouraged or endangered by institutions?


  • Giuseppina Gianfreda

    () (Università della Tuscia)

  • Giovanna Vallanti

    () (LUISS "Guido Carli")


Employment protection is the results of labour laws and of institutional factors which are not encompassed in official legislation. Courts? delay is settling labour disputes are among those factors. Using individual data on the Italian workforce for the period 2007-2010 and exploiting the territorial heterogeneity in the duration of labour suits among Italian regions we investigate the effect of labour trial delays on the composition of employment. We fi?nd that Labour Courts'delays hinder the occupation rate for specific categories of workers, i.e. women, young and low skilled people, while increasing the inactivity rate of the same groups; furthermore, long duration of trials reduces the likelyhood of accessing a permanent occupation for the same groups. Finally, it induces a shift from short term to long term unemployment.

Suggested Citation

  • Giuseppina Gianfreda & Giovanna Vallanti, 2015. "Labour Courts delays and the composition of employment: Is labour encouraged or endangered by institutions?," Working Papers LuissLab 15121, Dipartimento di Economia e Finanza, LUISS Guido Carli.
  • Handle: RePEc:lui:lleewp:15121

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    References listed on IDEAS

    1. Lawrence M. Kahn, 2007. "The Impact of Employment Protection Mandates on Demographic Temporary Employment Patterns: International Microeconomic Evidence," Economic Journal, Royal Economic Society, vol. 117(521), pages 333-356, June.
    2. Chemin, Matthieu, 2009. "Do judiciaries matter for development? Evidence from India," Journal of Comparative Economics, Elsevier, vol. 37(2), pages 230-250, June.
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    7. Fraisse, H. & Kramarz, F. & Prost, C., 2009. "Labor Court Inputs, Judicial Cases Outcomes and Labor Flows: Identifying Real EPL," Working papers 256, Banque de France.
    8. Silvia Giacomelli & Carlo Menon, 2013. "Firm size and judicial efficiency: evidence from the neighbour's court," Temi di discussione (Economic working papers) 898, Bank of Italy, Economic Research and International Relations Area.
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    Cited by:

    1. Castro Massimo Finocchiaro & Guccio Calogero, 2015. "Bottlenecks or Inefficiency? An Assessment of First Instance Italian Courts’ Performance," Review of Law & Economics, De Gruyter, vol. 11(2), pages 317-354, July.
    2. Gianluca Esposito & Sergi Lanau & Sebastiaan Pompe, 2014. "Judicial System Reform in Italy - A Key to Growth," IMF Working Papers 14/32, International Monetary Fund.

    More about this item


    EPL; courts; occupation rate; inactive workers; temporary jobs.;

    JEL classification:

    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • J63 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Turnover; Vacancies; Layoffs
    • K31 - Law and Economics - - Other Substantive Areas of Law - - - Labor Law
    • K41 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Litigation Process

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