How German Labor Courts Decide: An Econometric Case Study

Posted: 20 Dec 2010

See all articles by Helge Berger

Helge Berger

Free University Berlin - Department of Economics; CESifo (Center for Economic Studies and Ifo Institute for Economic Research)

Michael Neugart

Technical University of Darmstadt

Date Written: December 20, 2010

Abstract

Courts are an important element in the institutional framework of labor markets, often determining the actual degree of employment protection. German labor courts provide a vivid example in this regard. However, we know relatively little about actual court behavior. A unique data set on German labor court verdicts reveals that social and other criteria like employee characteristics, the type of job, local labor market conditions, and court composition influence court decisions. At least as striking is that workers’ chances to win depend on where and when their cases are filed generating considerable ex-ante uncertainty about outcomes.

Keywords: labor courts, uncertainty, employment protection, labor market regulation, severance pay, firing costs, dismissals

JEL Classification: J41, J65, K31, K41

Suggested Citation

Berger, Helge and Neugart, Michael, How German Labor Courts Decide: An Econometric Case Study (December 20, 2010). Available at SSRN: https://ssrn.com/abstract=1728652

Helge Berger

Free University Berlin - Department of Economics ( email )

Boltzmannstr. 20
Berlin 14195, 14195
Germany
+49 30 838-54037 (Phone)
+49 30 838-52782 (Fax)

HOME PAGE: http://www.wiwiss.fu-berlin.de/berger/eng_index.htm

CESifo (Center for Economic Studies and Ifo Institute for Economic Research) ( email )

Poschinger Str. 5
Munich, DE-81679
Germany
+49 89 9224 1266 (Phone)
+49 89 9224 1409 (Fax)

HOME PAGE: http://www.CESifo.de

Michael Neugart (Contact Author)

Technical University of Darmstadt ( email )

Hochschulstraße 1
Darmstadt, 64289
Germany

HOME PAGE: http://www.vwl3.wi.tu-darmstadt.de

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