Employment Protection and Temporary Work Agencies

22 Pages Posted: 11 Aug 2011

See all articles by Florian Baumann

Florian Baumann

University of Tuebingen - Faculty of Economics and Business Administration

Mario Mechtel

Leuphana University of Lueneburg

Nikolai Stähler

Johannes Gutenberg University Mainz - Department of Economic Theory

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Date Written: September 2011

Abstract

Employers who use temporary agency staff in contrast to regular staff are not affected by employment protection regulations when terminating a job. Therefore, services provided by temporary work agencies may be seen as a substitute for regular employment. In this paper, we analyse the effects of employment protection on the size of the temporary work agency sector in a model of equilibrium unemployment. We find that higher firing costs may even reduce temporary work agency employment if agencies themselves are subject to employment protection, a consideration that distinguishes our results from those for fixed‐term employment arrangements.

Suggested Citation

Baumann, Florian and Mechtel, Mario and Stähler, Nikolai, Employment Protection and Temporary Work Agencies (September 2011). LABOUR, Vol. 25, Issue 3, pp. 308-329, 2011, Available at SSRN: https://ssrn.com/abstract=1908020 or http://dx.doi.org/10.1111/j.1467-9914.2010.00493.x

Florian Baumann (Contact Author)

University of Tuebingen - Faculty of Economics and Business Administration ( email )

Mohlstrasse 36
D-72074 Tuebingen, 72074
Germany

Mario Mechtel

Leuphana University of Lueneburg ( email )

Scharnhorststraße 1
Wilschenbrucher Weg 69
Lüneburg, 21335
Germany
+4941316772636 (Phone)

HOME PAGE: http://www.mario-mechtel.de

Nikolai Stähler

Johannes Gutenberg University Mainz - Department of Economic Theory ( email )

D 55099 Mainz
Germany
+49-6131-39-25442 (Phone)
+49-6131-39-23827 (Fax)

HOME PAGE: http://w3.ub.uni-konstanz.de/v13/volltexte/2005/1640//pdf/0507.pdf

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