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Institutional Rigidities and Employment Rigidity on the Italian Labour Market
Jiménez-Rodríguez, Rebeca | Russo, Giuseppe
Applied Economics Quarterly, Vol. 54 (2008), Iss. 3 : pp. 217–227
3 Citations (CrossRef)
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1Department of Economics. University of Salamanca. Campus Miguel de Unamuno. E-37007. Salamanca. Spain. Tel.: +34 923 29 46 40 (ext. 35 14). Fax: +34 923 29 46 86.
2Visiting Professor Franklin College Switzerland, Via Ponte Tresa 29, 6924 Sorengo (Lugano), Switzerland. Correspondence to: Dipartimento di Scienze Economiche e Statistiche, Università di Salerno. 84084, Fisciano (SA), Italy. Tel.: +39 089 96 2159. Fax.:
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AGGREGATE EMPLOYMENT DYNAMICS AND (PARTIAL) LABOUR MARKET REFORMS
Jiménez‐Rodríguez, Rebeca | Russo, GiuseppeBulletin of Economic Research, Vol. 64 (2012), Iss. 3 P.430
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Abstract
A well-established result in the theoretical literature on labour market flexibility is that the employment should be more volatile in “flexible” labour markets. Over the last 35 years, Italy gives a good example of a transition from an over-regulated labour market into a quite more flexible one. According to the theory, the deregulation is expected to increase the employment variance. Despite the anecdotal evidence reported in the press, the literature hardly finds any evidence for such an effect. This paper exploits time-series of several employment indicators since 1980, allowing us to compare decades with different labour market regulation. All the considered series show evidence of a structural break with an increase in their variance after the deregulation, confirming the expected pattern. This gives some support to the concerns for increased job insecurity.