Abstract
The paper studies whether temporary jobs in the form of fixed-term replacement contracts reduce the risk of future unemployment among job-seekers. Using matching on detailed information on labour market history and personal characteristics we find positive average effects of having a replacement contract. Our second focus is on whether the duration of the contract matters. We use data on replacement contracts with information on the ex ante duration of the contract which is determined by the individual on leave and find no significant effect on the subsequent unemployment risk of the replacement worker. However, the longer the replacement contract the higher is the probability of having an open ended contract at the same site 2–2.5 years after the start of the contract. Overall, the results suggest that replacement contracts may reduce the risk of future unemployment, but that longer contracts only improve the position within the workplace and not necessarily on the labour market in general.
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Hartman, L., Liljeberg, L. & Skans, O.N. Stepping-stones, dead-ends, or both? An analysis of Swedish replacement contracts. Empir Econ 38, 645–668 (2010). https://doi.org/10.1007/s00181-009-0283-9
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DOI: https://doi.org/10.1007/s00181-009-0283-9