Have Labor Market Reforms at the Turn of the Millennium Changed the Job and Employment Durations of new Entrants?
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Many European countries during the 1990s and early 2000s tried to raise labor market flexibility by relaxing their employment protection legislation. This paper investigates whether the reforms have influenced job and employment stability for labor market entrants in Germany and Italy. Duration models are estimated using comparable administrative data for the two countries. The results provide, to some extent, evidence of a decrease in job stability. However, this is not accompanied by a compensating increase in employment stability during the first 3 years after labor market entry.
KeywordsJob and employment stability Flexibility Labor market reforms Duration analysis Mixed proportional hazard Germany Italy
JELJ62 J64 J68 K31 C41
In July 2009 we presented this paper at the ILO-RDW conference on “Regulating for Decent Work—Innovative labor regulation in a turbulent world” in Geneva. We wish to thank Janine Berg, Sandrine Cazes and all the participants for their helpful suggestions. We also wish to thank Alfonso Arpaia, Simone Bertoli, Marco Caliendo, Bruno Contini, Riccardo Del Punta, Debra Hevenstone, Frauke Kreuter, Anton Nivorozhkin, Lia Pacelli, Matteo Picchio, Jennifer Sinibaldi, Joachim Wolff and two anonymous referees for their useful comments. A visiting fellowship in July 2008 at DG Economic and Financial Affairs in Brussels to develop this research project is gratefully acknowledged.
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