Does Marginal Employment Substitute Regular Employment? – A Heterogeneous Dynamic Labor Demand Approach for Germany

Lena Jacobi and Sandra Schaffner

No 56, Ruhr Economic Papers from RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen

Abstract: In Germany we observe a decline in regular employment and an increase in atypical forms of employment. Especially marginal part-time employment which is characterized by lower tax rates and lower social security contributions increased substantially after a reform in 2003 made this type of employment even more attractive to employers. In our paper we estimate the substitutability of regular employment by marginal part-time employment using data on the industry level before and after the reform. We detect high substitution elasticities with respect to three skill categories of regular employment in both time periods. The substitutability of unskilled full-time workers increased significantly after the reform.

Keywords: Mini-Jobs; dynamic labor demand; elasticities; Hartz-reforms (search for similar items in EconPapers)
JEL-codes: J23 J31 (search for similar items in EconPapers)
Date: 2008
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Citations: View citations in EconPapers (22)

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Persistent link: https://EconPapers.repec.org/RePEc:zbw:rwirep:56

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