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Short Notice, Big Difference? The Effect of Temporary Employment on Firm Competitiveness across Sectors

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  • Romina Giuliano
  • Stephan Kampelmann
  • Benoit Mahy
  • François Rycx

Abstract

This article is one of the first to examine how the use of fixed-term employment contracts (FTCs) affects firm competitiveness (i.e. productivity, wages and profits) while controlling for key econometric issues such as time-invariant unobserved workplace characteristics, endogeneity and state dependence. We apply dynamic panel data estimation techniques to detailed Belgian linked employer–employee data covering all years from 1999 to 2010. Results show that the effects of FTCs on firm competitiveness vary across sectors: while temporary employment is found (at the 10 per cent significance level) to enhance productivity and profits in (labour-intensive) services, this is not the case in manufacturing and construction.

Suggested Citation

  • Romina Giuliano & Stephan Kampelmann & Benoit Mahy & François Rycx, 2017. "Short Notice, Big Difference? The Effect of Temporary Employment on Firm Competitiveness across Sectors," ULB Institutional Repository 2013/253180, ULB -- Universite Libre de Bruxelles.
    • Handle: RePEc:ulb:ulbeco:2013/253180
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    7. Fikru Kefyalew Alemayehu & Sigbjørn Landazuri Tveteraas, 2020. "Long-run labour flexibility in hospitality: A dynamic common correlated effects approach," Tourism Economics, , vol. 26(4), pages 704-718, June.
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    JEL classification:

    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • M12 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Personnel Management; Executives; Executive Compensation

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