|
EconStor >
Institut für Weltwirtschaft (IfW), Kiel >
Kieler Arbeitspapiere, IfW >
Please use this identifier to cite or link to this item:
http://hdl.handle.net/10419/39655
|
| | |
| Title: | | Firing tax vs. severance payment: An unequal comparison  |
| Authors: | | Wesselbaum, Dennis |
| Issue Date: | | 2010 |
| Series/Report no.: | | Kiel working paper 1644 |
| Abstract: | | Empirical evidence indicates that lay-off costs consist of two elements, namely firing costs and severance payments. This paper investigates business cycle and steady state effects of firing costs and severance payments and discusses the differences. We find that severance payments imply a lower volatility of key labor market variables compared with firing costs. Persistently increasing those costs, reduces the welfare in the model economy but increases employment. The reason for the different performance is the impact on the wage and the additional stimulus caused by severance payments. The social planner therefore faces a trade-off in the design of employment protection. Furthermore, the design of lay-off costs also has strong implications for the design of other elements of employment protection. |
| Subjects: | | Firing Costs Severance Payments Welfare |
| JEL: | | D61 E24 E32 |
| Document Type: | | Working Paper |
| Appears in Collections: | | Publikationen von Forscherinnen und Forschern des IfW Kieler Arbeitspapiere, IfW
|
| Files in This Item:
| |
|
| No. of Downloads:
| |
| last Month |
last 3 Month |
total |
|
|
|
|
|
| |
| | |
Download bibliographical data as:
BibTeX
|
| |
Share on:http://hdl.handle.net/10419/39655
|
Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.
|