Quit Behavior and the Role of Job Protection

Anne Gielen and Konstantinos Tatsiramos

No 6540, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: Job protection reduces job turnover by changing firms' hiring and firing decisions. Yet the effect of job protection on workers' quit decisions and post-quit outcomes is still unknown. We present the first evidence using individual panel data from 12 European countries, which differ both in worker turnover rates and in the level of job protection. We find that workers are less likely to quit their job in countries with more job protection, but conditional on quitting they receive higher wages. This evidence can be explained by increased mobility costs associated with higher expected risk of post-quit layoff and job mismatch.

Keywords: labor mobility; employment protection; institutions; wages; job satisfaction (search for similar items in EconPapers)
JEL-codes: J28 J62 (search for similar items in EconPapers)
Pages: 38 pages
Date: 2012-05
New Economics Papers: this item is included in nep-eur, nep-hrm, nep-lab and nep-lma
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (15)

Published - published in: Labour Economics, 2012, 19 (4), 624 - 632

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Journal Article: Quit behavior and the role of job protection (2012)
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