Effects of Employment protection legislation on the ability to downsize: Firms in weaker position are most affected?

Vesna Mandakovic () and Yarela Flores
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Yarela Flores: School of Business and Economics, Universidad del Desarrollo

Serie Working Papers from Universidad del Desarrollo, School of Business and Economics

Abstract: The research on downsizing has focused either on the causes or on the effects of downsizing on firms’ performance. This paper empirically investigates how the interaction between increasing employment protection legislation (EPL) and firms’ attributes affects downsizing decisions, our hypothesis are founded in the fact that the negative effect of EPL in downsizing can be attenuated or enhanced in the presence of heterogeneous attributes of firms.

Keywords: Employment protection legislation; Labor; Downsizing; Firm heterogeneity; Developing economies (search for similar items in EconPapers)
Date: 2014, Revised 2014
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Persistent link: https://EconPapers.repec.org/RePEc:dsr:wpaper:12

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