Scoppa, Vincenzo (2008): Shirking and Employment Protection Legislation: Evidence from a Natural Experiment.
Download (55kB) | Preview
In 1990 a reform in Italy has modified the employment protection legislation for employees of small firms (with fewer than 16 employees) making much more costly for firms to dismiss workers, while leaving unchanged the employment protection in large firms. Using a sample of administrative data (WHIP) from National Institute of Social Security we compare absenteeism rates (used as a proxy of shirking) in small and in large firms in the years just before (1989) and after (1991) the reform, with a difference-in-differences estimator. In line with theoretical predictions, we find a strong increase (around 18%) in shirking of workers employed in small firms after the increase in dismissal costs. This finding is robust to alternative definitions of small firm and to different time periods.
|Item Type:||MPRA Paper|
|Original Title:||Shirking and Employment Protection Legislation: Evidence from a Natural Experiment|
|Keywords:||Absenteeism; Shirking; Employment Protection Legislation; Difference-in-differences.|
|Subjects:||J - Labor and Demographic Economics > J4 - Particular Labor Markets > J41 - Labor Contracts
M - Business Administration and Business Economics ; Marketing ; Accounting ; Personnel Economics > M5 - Personnel Economics > M51 - Firm Employment Decisions ; Promotions
J - Labor and Demographic Economics > J5 - Labor-Management Relations, Trade Unions, and Collective Bargaining > J50 - General
|Depositing User:||VINCENZO SCOPPA|
|Date Deposited:||10. Aug 2009 09:32|
|Last Modified:||19. Apr 2015 13:29|
Barmby, T., Sessions, J. and Treble, J.G. (1994), “Absenteeism, Efficiency Wages, and Shirking”, Scandinavian Journal of Economics, 96, 4, pp. 561-566.
Boeri, T., Jimeno, F., (2005), “The effects of employment protection: Learning from variable enforcement”, European Economic Review, 49, pp. 2057–2077
Dionne, G., Dostie, B., (2007), “New Evidence on the Determinants of Absenteeism Using Linked Employer-Employee Data”, Industrial & Labor Relations Review, 61, 1.
Ichino, A. Maggi, G., (2000), “Work Environment and Individual Background: Explaining Regional Shirking Differentials in a Large Italian Firm”, Quarterly Journal of Economics, 3, pp. 1057-90.
Ichino, A., Riphahn, R., (2005), “The Effect of Employment Protection on Worker Effort: Absenteeism during and after Probation”, Journal of the European Economic Association, 1, pp. 120–143.
Kugler, A., Pica G., (2008), “Effects of Employment Protection on Worker and Job Flows: Evidence from the 1990 Italian Reform”, Labour Economics, 15, pp. 78–95. OECD, (1999), Employment Outlook 1999, OECD.
Riphahn, R., (2004), “Employment Protection and Effort among German Employees”, Economics Letters, 85, pp. 353–357.
Shapiro C., Stiglitz J. (1984), “Equilibrium Unemployment as a Worker Discipline Device”, American Economic Review, 74, 3, pp. 433-444.