Employment Protection and Temporary Work Agencies

52 Pages Posted: 8 Jun 2016

See all articles by Florian Baumann

Florian Baumann

University of Tuebingen - Faculty of Economics and Business Administration

Mario Mechtel

Leuphana University of Lueneburg

Nikolai Stahler

Deutsche Bundesbank - Economics Department

Multiple version iconThere are 2 versions of this paper

Date Written: 2008

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 analyze 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 which distinguishes our results from those for fixed-term employment arrangements.

Keywords: employment protection, temporary work agencies, search and matching models, unemployment

JEL Classification: J68, J65, J64, J30

Suggested Citation

Baumann, Florian and Mechtel, Mario and Stahler, Nikolai, Employment Protection and Temporary Work Agencies (2008). Bundesbank Series 1 Discussion Paper No. 2008,26, Available at SSRN: https://ssrn.com/abstract=2785325

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 )

Scharnhorststra├če 1
Wilschenbrucher Weg 69
L├╝neburg, 21335
Germany
+4941316772636 (Phone)

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

Nikolai Stahler

Deutsche Bundesbank - Economics Department ( email )

Wilhelm-Epstein-Strasse 14
60431 Frankfurt am Main
Germany

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