Labor market regulations and firm adjustments in skill demand

• 成果类型: Article
• 署名作者: Bottasso, Anna; Bratti, Massimiliano; Cardullo, Gabriele; Conti, Maurizio; Sulis, Giovanni
• 署名单位: University of Genoa; University of Milan; University of Cagliari
• 刊物名称: JOURNAL OF PUBLIC ECONOMICS
• ISSN/ISSBN: 0047-2727
• DOI: 10.1016/j.jpubeco.2024.105292
• 发表日期: 2025
• 关键词: Labor market regulations; employment protection; Fixed-term work; Skill demand; worker flows

摘要

We study how changes in labor market regulations may trigger firm adjustments in skill demand. Leveraging rich administrative data from Italy, we investigate the effects of a reform that, to increase job stability, reduced the firing costs for permanent employees and tightened the regulation of fixed-term contracts. Using a difference-in-differences (DID) design, we document that the reform had unintended effects, inducing firms to increase layoffs of low-skilled (LS) permanent employees and reduce hires of LS workers on fixed-term contracts. However, the reform had no effect on high-skilled workers or permanent hires. A theoretical search and matching model with heterogeneous skills and contract durations makes sense of our main findings.