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Discussion Paper Details

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Title: Enforcement of Employment Security Regulations, On-The-Job Search and Unemployment Duration

Author(s): Tito Boeri

Publication Date: March 1998

Keyword(s): employment security, Job-to-job shifts and Labour Turnover

Programme Area(s): Human Resources

Abstract: Contrary to the popular wisdom, ?sclerotic? European labour markets are characterized by relatively large job turnover rates. A model is developed which ? unlike standard theories of job matching with on-the-job search ? can account for the coexistence of strict employment security regulations, significant job-to-job shifts and high long-term unemployment rates in these countries. This is because: i) employment security regulations can only be enforced by increasing the number of workers on ?short-term jobs?; and ii) the latter compete for jobs with unemployed jobseekers. Evidence is presented, showing that job finding probabilities of the unemployed are decreasing in the incidence of temporary employment, in line with the predictions of the model.

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Bibliographic Reference

Boeri, T. 1998. 'Enforcement of Employment Security Regulations, On-The-Job Search and Unemployment Duration'. London, Centre for Economic Policy Research. https://cepr.org/active/publications/discussion_papers/dp.php?dpno=1850