Template-Type: ReDIF-Paper 1.0
Author-Name: Giulio Piccirilli
Author-X-Name-First: Giulio
Author-X-Name-Last: Piccirilli
Author-Email: giulio.piccirilli@unicatt.it
Author-Workplace-Name: DISCE, Università Cattolica

Title: Job protection, industrial relations and employment
Abstract: In a dynamic stochastic monopoly union model we show that firing costs have a
small and ambiguous impact on the level of employment if the union precommits to
future wages. Further, in comparison with the commitment equilibrium and for very
general union preferences, the no-commitment equilibrium exhibits higher wages and
a lower employment level.
Since commitment-like equilibria are more likely in cooperative bargain environments,
these results suggest that, coeteris paribus, the interaction between employment
protection and the quality of industrial relations reduces unemployment. We
provide evidence on OECD countries which is consistent with this predictions.
Length: 39
Creation-Date: 2007-10
File-URL: http://www.unicatt.it/Istituti/EconomiaImpresaLavoro/Quaderni/ieil0050.pdf
File-Format: Application/pdf
File-Function: First version, 2007
Number: ieil0050
Classification-JEL: J23 J51 J63
Keywords: Firing costs, unemployment, industrial relations.
Handle: RePEc:ctc:serie4:ieil0050