Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/227360
Authors: 
Ginja, Rita
Karimi, Arizo
Xiao, Pengpeng
Year of Publication: 
2020
Series/Report no.: 
IZA Discussion Papers No. 13833
Abstract: 
Search frictions make worker turnover costly to firms. A three-month parental leave expansion in Sweden provides exogenous variation that we use to quantify firms' adjustment costs upon worker absence and exit. The reform increased women's leave duration and likelihood of separating from pre-birth employers. Firms with greater exposure to the reform hired additional workers and increased incumbent hours, incurring additional wage costs. These adjustment costs varied by firms' availability of internal and external substitutes. Economy-wide analyses show that a higher reform exposure is correlated with fewer hires and lower starting wages of young women compared to men and older women.
Subjects: 
parental leave
firm-specific human capital
statistical discrimination
JEL: 
J13
J16
J21
J22
J31
Document Type: 
Working Paper

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