Dismissal Protection and Worker Flows in OECD Countries: Evidence from Cross-country/Cross-industry Data

Andrea Bassanini and Andrea Garnero

No 1211, CEPREMAP Working Papers (Docweb) from CEPREMAP

Abstract: Exploiting a unique dataset including cross-country comparable hiring and separation rates by type of transition for 24 OECD countries, 23 business-sector industries and 13 years, we study the effect of dismissal regulations on different types of gross worker flows, defined as one-year transitions. We use both a difference-in-difference approach – in which the impact of regulations is identified by exploiting likely cross-industry differences in their impact – and standard time-series analysis – in which the effect of regulations is identified through regulatory changes over time. We find that the more restrictive the regulation, the smaller is the rate of within-industry job-to-job transitions, in particular towards permanent jobs. By contrast, we find no significant effect as regards separations involving an industry change or leading to non-employment. The extent of reinstatement in the case of unfair dismissal appears to be the most important regulatory determinant of gross worker flows. We also present a large battery of robustness checks that suggest that our findings are robust.

Keywords: gross worker flows; industry-specific human capital; job-to-job transitions; EPL; reinstatement; cross-country data (search for similar items in EconPapers)
JEL-codes: J23 J24 J62 J63 (search for similar items in EconPapers)
Pages: 46 pages
Date: 2012-10
New Economics Papers: this item is included in nep-eur and nep-lab
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

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http://www.cepremap.fr/depot/docweb/docweb1211.pdf (application/pdf)

Related works:
Journal Article: Dismissal protection and worker flows in OECD countries: Evidence from cross-country/cross-industry data (2013)
Working Paper: Dismissal protection and worker flows in OECD countries: Evidence from cross-country/cross-industry data (2013)
Working Paper: Dismissal protection and worker flows in OECD countries: Evidence from cross-country/cross-industry data (2013)
Working Paper: Dismissal Protection and Worker Flows in OECD Countries: Evidence from Cross-Country/Cross-Industry Data (2012)
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