Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/20180
Authors: 
Addison, John T.
Teixeira, Paulino
Year of Publication: 
2003
Series/Report no.: 
IZA Discussion paper series 943
Abstract: 
In this study we examine the contribution of severance pay to employment and unemployment development using data on industrialized OECD countries. Our starting point is Lazear?s (1990) empirical dictum that severance payment requirements adversely impact the labor market. We extend his sample period and add to his parsimonious specification a variety of fixed and time-varying labor market institutions. While the positive effect of severance pay on unemployment garners some support, there is no real indication of adverse effects for (the three) other employment outcomes identified here. Moreover, with the possible exception of collective bargaining coordination, the role of institutions is also more muted than suggested in the literature.
Subjects: 
severance pay
employment protection
employment
labor force participation
unemployment
long-term unemployment
JEL: 
J65
J64
J23
E24
Document Type: 
Working Paper

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