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Temporary job protection and productivity growth in EU economies

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  • Damiani, Mirella
  • Pompei, Fabrizio
  • Ricci, Andrea

Abstract

The present study examines cross-national and sectoral differences in Total Factor Productivity (TFP) in fourteen European countries and ten sectors from 1995 to 2007. The main aim is to ascertain the role of employment protection of temporary contracts on TFP by estimating their effects with a “difference-in-difference” approach. Results show that deregulation of temporary contracts negatively influences the growth rates of TFP in European economies and that, within sectoral analysis, the role of this liberalization is greater in industries where firms are more used to opening short-term positions. By contrast, in our observation period, restrictions on regular jobs do not cause significant effects on TFP, whereas limited regulation of product markets and higher R&D expenses positively affect efficiency growth.

Suggested Citation

  • Damiani, Mirella & Pompei, Fabrizio & Ricci, Andrea, 2011. "Temporary job protection and productivity growth in EU economies," MPRA Paper 29698, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:29698
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    1. Mr. Giovanni Ganelli & Ms. Chie Aoyagi, 2013. "The Path to Higher Growth: Does Revamping Japan’s Dual Labor Market Matter?," IMF Working Papers 2013/202, International Monetary Fund.
    2. Andrea Ricci & Robert Waldmann, 2015. "Firm financed training and pareto improving firing taxes," Economia Politica: Journal of Analytical and Institutional Economics, Springer;Fondazione Edison, vol. 32(2), pages 201-220, August.
    3. Damiani, Mirella & Pompei, Fabrizio & Ricci, Andrea, 2012. "Labour share and employment protection in European economies," MPRA Paper 43058, University Library of Munich, Germany.
    4. repec:pra:mprapa:43050 is not listed on IDEAS
    5. Mirella Damiani & Fabrizio Pompei & Andrea Ricci, 2013. "Wages and Labour Productivity: the role of performance-related pay in Italian firms," Quaderni del Dipartimento di Economia, Finanza e Statistica 124/2013, Università di Perugia, Dipartimento Economia.
    6. Francesco Devicienti & Paolo Naticchioni & Andrea Ricci, 2015. "How Do Demand Volatility And Unions Affect Temporary Employment? A Firm-Level Approach," Working Papers 0415, CREI Università degli Studi Roma Tre, revised 2015.
    7. Francesco Devicienti & Paolo Naticchioni & Andrea Ricci, 2018. "Temporary Employment, Demand Volatility, and Unions: Firm-Level Evidence," ILR Review, Cornell University, ILR School, vol. 71(1), pages 174-207, January.
    8. Mirella Damiani & Andrea Ricci, 2011. "Decentralised bargaining and performance related pay: new evidence from a panel of Italian firms," Quaderni del Dipartimento di Economia, Finanza e Statistica 97/2011, Università di Perugia, Dipartimento Economia.
    9. Paolo Pini, 2013. "Cinque azioni per la crescita e l’occupazione, in un contesto di politiche contro l’"austerità espansiva"," ECONOMIA E SOCIET REGIONALE, FrancoAngeli Editore, vol. 0(2), pages 86-96.
    10. Mai Dao & Davide Furceri & Jisoo Hwang & Meeyeon Kim & Tae-Jeong Kim, 2014. "Strategies for Reforming Korea's Labor Market to Foster Growth," Working Papers 2014-25, Economic Research Institute, Bank of Korea.
    11. Francesco Venturini, 2011. "Product variety, product quality, and evidence of Schumpeterian endogenous growth: a note," Quaderni del Dipartimento di Economia, Finanza e Statistica 93/2011, Università di Perugia, Dipartimento Economia.
    12. Aoyagi, Chie & Ganelli, Giovanni, 2015. "Does revamping Japan's dual labor market matter?," Economic Systems, Elsevier, vol. 39(2), pages 339-357.
    13. Nicola Acocella, "undated". "The theoretical roots of EMU institutions and policies during the crisis," Working Papers 126/14, Sapienza University of Rome, Metodi e Modelli per l'Economia, il Territorio e la Finanza MEMOTEF.
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    Keywords

    productivity; labor regulation;

    JEL classification:

    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • O43 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Institutions and Growth
    • J58 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Public Policy
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General

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