Temporary Employment, Job Flows and Productivity: A Tale of Two Reforms

Abstract

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. We investigate the effects of two reforms of temporary employment using panel data on Italian firms. We exploit variation in their implementation across regions and sectors for identification. We find that the reform of apprenticeship contracts increased job turnover and induced the substitution of external staff with firms' apprentices, with an overall productivityenhancing effect. The reform of fixed-term contracts instead did not produce the intended results: it induced a substitution of temporary employees in favour of permanent ones and reduced capital intensity, generating productivity losses. We estimate substitution elasticities across types of temporary contracts that are consistent with these interpretations. Terms of use: Documents in EconStor mayJEL-Code: J240, J410.

The Effects of Youth Labor Market Reforms: Evidence from Italian Apprenticeships

“…Focusing on the short-run effects, D 'Agostino et al (2015) find a higher retention in the apprenticeship and hence a lower transition into permanent employment. Looking at firm level outcomes, Cappellari et al (2012) show a positive impact of the apprenticeship reform on job reallocation and productivity.…”

“…Previous research has exploited the staggered implementation of the new apprenticeship contract by regions and sectors (Cappellari et al, 2012), focussing on the effect of firms' eligibility to the policy on firms' outcomes such as profits or wage costs. This corresponds to estimating the intention-to-treat effect (ITT).…”

Does dual employment protection affect TFP? Evidence from Spanish manufacturing firms

“…Similar but more updated results have been reported by Alonso-Borrego (2010) using the Firms' Balance Sheets of the Bank of Spain. More recently, using variation across sectors and over time, Cappellari et al (2012) have evaluated the effects on a variety of outcomes of an Italian reform in 2001 which relieved employers from justifying the use of temporary workers in the employment contract. Yet, despite sharing a similar empirical approach to ours, none of these papers explore the specific mechanism linking changes in the EPL gap to conversion rates and TFP growth that we stress here.…”

Temporary Employment, Demand Volatility and Unions: Firm-Level Evidence

“…RSUs have tended to replace RSAs, which are usually found in smaller companies and in certain sectors like banking. 8 See Cappellari et al (2012), as reference for these labor contracts shares, and also for those in the following.…”

“…Attention has been paid mainly to the alleged beneficial impacts in terms of unemployment reduction, especially for young workers (OECD, 2008), as well as the potential negative effects for the welfare of workers (Booth et al, 2002;Blanchard and Landier, 2002;Boeri, 2012) and labor productivity (Battisti and Vallanti, 2013;Cappellari et al, 2012;.…”