Delays in Renewal of Labor Contracts: Theory and Evidence

Leif Danziger () and Shoshana Neuman ()

No 709, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: In many countries, an expired labor contract is automatically extended during the often protracted delay before the new contract is signed. Our theoretical model focuses on macroeconomic factors in explaining the delay. It emphasizes the importance of the realized nominal and real shocks, and of the levels of nominal and real uncertainty. The model is tested using Israeli collective wage agreements where long delays are frequent. The empirical findings strongly support the theoretical model. Thus, nominal uncertainty is found to increase the delay, and real uncertainty to decrease the delay, but less in the public than in the private sector.

Keywords: renewal; delay; labor contract (search for similar items in EconPapers)
JEL-codes: J52 (search for similar items in EconPapers)
Pages: 45 pages
Date: 2003-02
New Economics Papers: this item is included in nep-lab and nep-ltv
References: View references in EconPapers View complete reference list from CitEc
Citations:

Published - published in: Journal of Labor Economics, 2005, 23(2), 341-372

Downloads: (external link)
https://docs.iza.org/dp709.pdf (application/pdf)

Related works:
Journal Article: Delays in Renewal of Labor Contracts: Theory and Evidence (2005)
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:dp709

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 ().