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Matching Workers to Jobs in the Fast Lane: the Operation of Fixed-term Contracts

  • José Varejão
  • Pedro Portugal

In this paper we look at fixed-term contracts and examine the main features of temporary as opposed to regular employment, keeping the focus on employment careers and wage dynamics of workers employed under fixed-term contracts. Previous work found that fixed-term contracts serve as screening devices for employers. Here it is found that fixed-term contracts serve as search devices for workers, as well. Hence, they can be considered steppingstones to permanent forms of employment. However, if due to a job loss episode, a worker receives at some evolved stage of his or her career a fixed-term contract, there is an indication that both his wage and subsequent employment prospects are severely harmed.

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File URL: http://www.bportugal.pt/en-US/BdP%20Publications%20Research/WP200410.pdf
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Paper provided by Banco de Portugal, Economics and Research Department in its series Working Papers with number w200410.

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Date of creation: 2004
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Handle: RePEc:ptu:wpaper:w200410
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  1. 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.
  2. Alison L. Booth & Marco Francesconi & Jeff Frank, 2002. "Temporary Jobs: Stepping Stones or Dead Ends?," LABORatorio R. Revelli Working Papers Series 8, LABORatorio R. Revelli, Centre for Employment Studies.
  3. José Varejão & Pedro Portugal, 2003. "Why do Firms Use Fixed-Term Contracts?," Working Papers w200308, Banco de Portugal, Economics and Research Department.
  4. Maia Güell & Barbara Petrongolo, 2000. "Workers Transitions from Temporary to Permanent Employment: the Spanish Case," CEP Discussion Papers dp0438, Centre for Economic Performance, LSE.
  5. Helen Connolly & Peter Gottschalk, 2000. "Stepping-stone Jobs: Theory and Evidence," Boston College Working Papers in Economics 427, Boston College Department of Economics, revised 02 Apr 2001.
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