Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/185248
Authors: 
Heywood, John S.
O'Mahony, Mary
Siebert, W. Stanley
Rincon-Aznar, Ana
Year of Publication: 
2018
Series/Report no.: 
IZA Discussion Papers 11788
Abstract: 
This paper tests whether the job security offered by stricter employment protection legislation (EPL) undermines positive compensating wage differentials that would otherwise be paid. Specifically, we ask whether industries with relatively more need for layoffs and labour flexibility have lower wages in countries where stricter EPL protects workers from layoffs. We find this generally to be true for a large sample of industries in the major OECD countries over 1984-2005, particularly for wages of unskilled workers. However, we also find that where workers are well organised, they can take advantage of EPL to secure higher wages.
Subjects: 
employment protection legislation
labour regulation
compensating wage differentials
education and inequality
labour organisation
layoffs
JEL: 
I24
J31
J41
J50
J63
J83
K31
K51
L51
M50
Document Type: 
Working Paper

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