Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/295770 
Year of Publication: 
2024
Series/Report no.: 
IZA Discussion Papers No. 16747
Publisher: 
Institute of Labor Economics (IZA), Bonn
Abstract: 
This paper provides a review of the existing literature on the effects of employment protection legislation (EPL) on job allocation across industries, firms, and workers, and its implications for innovation and economic growth. We analyze empirical studies to assess how EPL influences resource allocation, firm dynamics, and labor market segmentation. The review highlights the heterogeneous effects of EPL on different firms and workers' groups. Additionally, we discuss the channels identified in the structural literature through which EPL-induced job reallocation affects productivity, innovation, and overall growth. While existing evidence demonstrates the significant influence of EPL on all these outcomes, further quantification of these effects remains a research challenge.
Subjects: 
job protection
job allocation
economic growth
productivity
innovation
JEL: 
JO8
J23
O47
O31
Document Type: 
Working Paper

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