Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/170995 
Year of Publication: 
2017
Series/Report no.: 
IZA Discussion Papers No. 11011
Publisher: 
Institute of Labor Economics (IZA), Bonn
Abstract: 
We exploit long time series of industry-level data in a group of OECD countries to analyze the short-term labor market effects of reforms lowering barriers to entry and dismissal costs. Our estimates show that both policies induce non-negligible transitory employment losses, a result that is confirmed by complementary evidence from case studies of three recently implemented EPL reforms. The strength of these effects varies depending on the underlying industry and labor market structure, and on cyclical conditions: the employment cost of deregulation is higher in economic downturns, negligible in good times. These findings prove robust to a set of specification and sensitivity checks, and are confirmed after standard reverse causality and falsification tests.
Subjects: 
product market regulation
EPL
employment losses
industry data
JEL: 
J23
L51
L11
Document Type: 
Working Paper

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