Do labor costs affect companies’ demand for labor?

Hamermesh, Dan

doi:10.15185/izawol.3

Cited by 25 publications

(21 citation statements)

References 13 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…The first strand of the related literature explores the impacts on employment of labourrelated policies that impose higher labour costs, such as minimum wages, and overtime regulation (Kim, 2008;Sakai, 2009;Miyazato and Ogura, 2010;Kambayashi, Kawaguchi and Yamada, 2013;Kawaguchi and Mori, 2013;Hamermesh, 2014;Kawaguchi, Naito and Yokoyama, 2017). Hamermesh (2014) describes how polices that increase labour costs, such as overtime pay, hiring subsidies, a minimum wage, and payroll taxes, can affect both employment and working hours. Nunziata (2005) shows that labour market regulations could explain a great part of the labour-cost rise in OECD countries from 1960 to 1994.…”

Section: Introductionmentioning

confidence: 99%

The Labour Market Effects of Increases in Social Insurance Premium: Evidence from Japan

Kodama

Yokoyama

2018

Oxf Bull Econ Stat

View full text Add to dashboard Cite

Exploiting heterogeneous variations in labour cost increases due to Japan's 2003 social insurance premium reform as a natural experiment, we estimate the impacts of the increased social insurance premiums on employment, working hours and payroll costs. Using the difference‐in‐differences method with establishment fixed effects, we find that firms reduce the number of employees and increase average annual earnings from longer working hours in response to an exogenous increase in labour costs without productivity gains. Firms manage to pay for this increase in the average wage paid to the remaining workers by reducing the number of employees to keep total payroll costs unchanged. In contrast, since social insurance premiums are shared equally between employees and employers, firms pay the remaining half premiums that they are imposed with. Sub‐sample analyses show that firms adhering to a labour hoarding policy did fire many workers taking advantage of the 2003 reform. This may indicate that the reform provided a good excuse to cut employment in firms that had been forced to comply with a labour hoarding policy even in an over‐employment situation, which is more likely in sectors and countries where dismissals are rigorously regulated.

show abstract

Section: Introductionmentioning

confidence: 99%

The Labour Market Effects of Increases in Social Insurance Premium: Evidence from Japan

Kodama

Yokoyama

2018

Oxf Bull Econ Stat

View full text Add to dashboard Cite

show abstract

“…The relation between the optimal duration of temporary contracts and the shock arrival rate is displayed on …gure 5. 21 To understand the shape of the optimal duration, it is convenient to start from a low shock arrival rate and see how the duration changes as the arrival rate increases. When the shock arrival rate is su¢ ciently small, the optimal contract duration is longer than , which implies that there is no tax to pay.…”

Section: The French Systemmentioning

confidence: 99%

“…One needs to de…ne the value of two more parameters, the investment cost the …rm has to pay to …nd a production opportunity, and m; the parameter of the matching function, to be able to de…ne the equilibrium value of the labor market tightness, de…ned by the free entry condition (14). The values of these two parameters are chosen to match the unemployment rate, equal to 13:5%; and the elasticity of employment with respect to the wage, assumed equal to 1, which is the relevant target for low skilled workers (Hamermesh, 2014). As a result, it turns out that in our calibration m and are equal to 0:0021 and 20:35 respectively.…”

Section: Estimation and Calibrationmentioning

confidence: 99%

Taxation of Temporary Jobs: Good Intentions with Bad Outcomes?

Cahuc

Charlot

Malherbet

et al. 2019

The Economic Journal

View full text Add to dashboard Cite

This article analyses the consequences of the taxation of temporary jobs of short duration recently introduced in several European countries to induce firms to create more open-ended contracts and to increase the duration of jobs. The estimation of a job search and matching model on French data shows that the taxation of temporary jobs does not reach its objectives: it reduces the mean duration of jobs and decreases job creation, employment and welfare of unemployed workers.

show abstract

“…18 The monthly sum of the net wage and the net short-time work bene…t cannot be inferior to the monthly net minimum wage corresponding to the number of hours of work stipulated in the labor contract. 19 Calavrezo and Lodin (2012). Sources: DADS (Insee), Sinapse (DGEFP) and Extranet (ASP).…”

Section: The Bene…ciaries Of the Reformsmentioning

confidence: 99%

Inefficient Short-Time Work

Cahuc

Nevoux

2018

SSRN Journal

View full text Add to dashboard Cite

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Any opinions expressed in this paper are those of the author(s) and not those of IZA. Research published in this series may include views on policy, but IZA takes no institutional policy positions. The IZA research network is committed to the IZA Guiding Principles of Research Integrity. The IZA Institute of Labor Economics is an independent economic research institute that conducts research in labor economics and offers evidence-based policy advice on labor market issues. Supported by the Deutsche Post Foundation, IZA runs the world's largest network of economists, whose research aims to provide answers to the global labor market challenges of our time. Our key objective is to build bridges between academic research, policymakers and society. IZA Discussion Papers often represent preliminary work and are circulated to encourage discussion. Citation of such a paper should account for its provisional character. A revised version may be available directly from the author. Terms of use: Documents inSchaumburg-Lippe-Straße 5-9 53113 Bonn, Germany Inefficient Short-Time WorkThis paper shows that the reforms which expanded short-time work in France after the great 2008-2009 recession were largely to the benefit of large firms which are recurrent short-time work users. We argue that this expansion of short-time work is an inefficient way to provide insurance to workers, as it entails cross-subsidies which reduce aggregateproduction. An efficient policy should provide unemployment insurance benefits funded by experience rated employers' contributions instead of short-time work benefits. We find that short-time work entails significant production losses compared to an unemployment insurance scheme with experience rating. JEL Classification:J63, J65

show abstract

Do labor costs affect companies’ demand for labor?

Cited by 25 publications

References 13 publications

The Labour Market Effects of Increases in Social Insurance Premium: Evidence from Japan

The Labour Market Effects of Increases in Social Insurance Premium: Evidence from Japan

Taxation of Temporary Jobs: Good Intentions with Bad Outcomes?

Inefficient Short-Time Work

Contact Info

Product

Resources

About