EconPapers    
Economics at your fingertips  
 

Why do Firms Use Fixed-Term Contracts?

Pedro Portugal and Jose Varejao ()

Working Papers from Banco de Portugal, Economics and Research Department

Abstract: This paper investigates the reasons why firms use fixed-term contracts. Two distinctive features of these contracts - reduced firing costs and the prohibition of contract rollover - are highlighted. Firms' decisions related to temporary contracts - the choice of the contract on offer and contract conversion - are modeled within standard adjustment costs and matching settings. Regression analysis is performed on the stock of fixed-term contracts and the flows of temporary workers to permanent positions. Results from a beta-binomial regression model indicate that screening workers for permanent positions is the single most important reason why firms use this type of contract.

JEL-codes: J23 J41 (search for similar items in EconPapers)
Date: 2003
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2) Track citations by RSS feed

Downloads: (external link)
https://www.bportugal.pt/sites/default/files/anexos/papers/wp200308.pdf

Related works:
Working Paper: Why Do Firms Use Fixed-Term Contracts? (2009) Downloads
Working Paper: Why Do Firms Use Fixed-Term Contracts? (2003) Downloads
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:ptu:wpaper:w200308

Access Statistics for this paper

More papers in Working Papers from Banco de Portugal, Economics and Research Department Contact information at EDIRC.
Bibliographic data for series maintained by DEE-NTD ().

 
Page updated 2020-01-17
Handle: RePEc:ptu:wpaper:w200308