Does Employment Protection Help Immigrants? Evidence from European Labor Markets

Filipa Sa ()

No 3414, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: High levels of employment protection reduce hiring and firing and have a theoretically ambiguous effect on the employment level. Immigrants, being new to the labor market, may be less aware of employment protection regulations and less likely to claim their rights, which may create a gap between the costs for employers of hiring a native relative to hiring an immigrant. This paper tests that hypothesis drawing on evidence for the EU and on two natural experiments for Spain and Italy. The results suggest that strict employment protection legislation (EPL) gives immigrants a comparative advantage relative to natives. Stricter EPL is found to reduce employment and reduce hiring and firing rates for natives. By contrast, stricter EPL has no effect on most immigrants and may even increase employment rates for those who have been in the country for a longer time.

Keywords: employment protection; immigration (search for similar items in EconPapers)
JEL-codes: J6 (search for similar items in EconPapers)
Pages: 45 pages
Date: 2008-03
New Economics Papers: this item is included in nep-eec, nep-lab, nep-ltv, nep-mig and nep-reg
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10)

Published - published in: Labour Economics, 2011, 18 (5), 624-642

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Journal Article: Does employment protection help immigrants? Evidence from European labor markets (2011)
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