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EXPLAINING THE SPREAD OF TEMPORARY JOBS AND ITS IMPACT ON LABOR TURNOVER
Author(s) -
Cahuc Pierre,
Charlot Olivier,
Malherbet Franck
Publication year - 2016
Publication title -
international economic review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 2.658
H-Index - 86
eISSN - 1468-2354
pISSN - 0020-6598
DOI - 10.1111/iere.12167
Subject(s) - stylized fact , economics , labour economics , production (economics) , turnover , aggregate (composite) , substitution (logic) , job creation , business , macroeconomics , computer science , materials science , management , composite material , programming language
This article provides a simple model that explains the choice between permanent and temporary jobs. This model, which incorporates important features of actual employment protection legislations neglected by the economic literature so far, reproduces the main stylized facts about entries into permanent and temporary jobs observed in Continental European countries. We find that job protection has very small effects on total employment but induces large substitution of temporary jobs for permanent jobs, which significantly reduces aggregate production.