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Empirical analysis of the relationship between labour cost stickiness and labour reforms in Spain
Author(s) -
ArgilésBosch Josep Mª.,
GarciaBlandón Josep,
Ravenda Diego
Publication year - 2023
Publication title -
accounting and finance
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.645
H-Index - 49
eISSN - 1467-629X
pISSN - 0810-5391
DOI - 10.1111/acfi.12991
Subject(s) - endogeneity , economics , estimation , social security , labour economics , demographic economics , econometrics , market economy , management
This study performs an empirical analysis on the relationship between labour cost stickiness and the decrease in employment protection in the Spanish labour reforms in 2010 and 2012. Following these reforms, the sticky behaviour of labour costs substantially decreased with respect to the pre‐reform period. All constituents of total labour costs followed a similar pattern: wages, social security contributions and number of employees. Results are robust to different models, estimation methods, periods of time, and industries, as well as with respect to endogeneity concerns.