EconPapers    
Economics at your fingertips  
 

Labor Market Regulation and Firm Adjustments in Skill Demand

Anna Bottasso, Massimiliano Bratti, Gabriele Cardullo, Maurizio Conti and Giovanni Sulis ()

No 16262, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: We study how changes in labor market regulation may trigger firm adjustments in skill demand. Leveraging rich administrative data from Italy, we investigate the effects of a reform that reduced firing costs for permanent employees and tightened temporary contracts' regulation to increase job stability. By using a difference-in-differences design, we document that the reform had unintended effects, inducing firms to increase layoffs of unskilled permanent employees and reducing hirings of unskilled workers on temporary contracts, but had no effect on skilled workers or permanent hirings. A theoretical search and matching model with heterogeneous skills and contract durations rationalizes our main findings.

Keywords: temporary work; employment protection; labor market regulation; skill demand; worker flows (search for similar items in EconPapers)
JEL-codes: J42 J63 J65 M53 (search for similar items in EconPapers)
Pages: 84 pages
Date: 2023-06
New Economics Papers: this item is included in nep-dge, nep-hrm and nep-lma
References: Add references at CitEc
Citations:

Forthcoming - revised version forthcoming as 'Labor Market Regulations and Firm Adjustments in Skill Demand' in: Journal of Public Economics

Downloads: (external link)
https://docs.iza.org/dp16262.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:iza:izadps:dp16262

Ordering information: This working paper can be ordered from
IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany

Access Statistics for this paper

More papers in IZA Discussion Papers from Institute of Labor Economics (IZA) IZA, P.O. Box 7240, D-53072 Bonn, Germany. Contact information at EDIRC.
Bibliographic data for series maintained by Holger Hinte ().

 
Page updated 2025-02-03
Handle: RePEc:iza:izadps:dp16262