Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/75924 
Year of Publication: 
2002
Series/Report no.: 
CESifo Working Paper No. 689
Publisher: 
Center for Economic Studies and ifo Institute (CESifo), Munich
Abstract: 
We consider a firm that is subject to employment protection laws that limit the firm‘s ability to fire labor. In particular, we suppose that though a firm which shuts down can fire all its workers, it may fire no fewer. Compared to a firm that is subject to no employment protection, a firm constrained in firing will prefer a risk-free project over a risky one, but may prefer the riskier of two risky projects.
Subjects: 
project choice
labor protection
Document Type: 
Working Paper
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