Working Paper: NBER ID: w13920
Authors: John Haltiwanger; Stefano Scarpetta; Helena Schweiger
Abstract: This paper analyzes job flows in a sample of 16 industrial and emerging economies over the past decade, exploiting a harmonized firm-level dataset. It shows that industry and firm size effects (and especially firm size) account for a large fraction in the overall variability in job flows. However, large residual differences remain in the job flow patterns across countries. To account for the latter, the paper explores the role of differences in employment protection legislation across countries. Using a difference-in-difference approach that minimizes possible endogeneity and omitted variable problems, our findings show that hiring and firing costs tend to curb job flows, particularly in those industries and firm size classes that require more frequent labor adjustment.
Keywords: job flows; industry; firm size; regulations
JEL Codes: J23; J53; K31
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| stringent hiring and firing regulations (J63) | job turnover (J63) |
| stringent hiring and firing regulations (J63) | lower job reallocation (J62) |
| stringent hiring and firing regulations (J63) | impact on entry and exit of firms (L11) |