Temporary Employment, Job Flows and Productivity: A Tale of Two Reforms

Lorenzo Cappellari, Dell’Aringa, Carlo () and Marco Leonardi
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Dell’Aringa, Carlo: Università Cattolica del Sacro Cuore

No 6526, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: We investigate the effects of two reforms of temporary employment using panel data on Italian firms. We exploit variation in their implementation across regions and sectors for identification. Our results show that the reform of apprenticeship contracts increased job turnover and induced the substitution of external staff with firms' apprentices, with an overall productivity-enhancing effect. The reform of fixed-term contracts instead did not produce the intended results: it induced a substitution of temporary employees in favour of external staff and reduced capital intensity, generating productivity losses. We estimate substitution elasticities across various types of temporary contracts that are consistent with this interpretation.

Keywords: employment contracts; productivity; institutional changes (search for similar items in EconPapers)
JEL-codes: J24 J41 (search for similar items in EconPapers)
Pages: 52 pages
Date: 2012-04
New Economics Papers: this item is included in nep-bec, nep-eff, nep-eur, nep-hrm and nep-lma
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Citations: View citations in EconPapers (113)

Published - published in: Economic Journal, 2012, 122 (562), F188-F215.

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Related works:
Journal Article: Temporary Employment, Job Flows and Productivity: A Tale of Two Reforms (2012)
Working Paper: Temporary Employment, Job Flows and Productivity: A Tale of two Reforms (2011)
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