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How are fixed-term contracts used by firms? An analysis using gross job and worker flows

In: Work, Earnings and Other Aspects of the Employment Relation

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  • Catalina Amuedo-Dorantes
  • Miguel Á. Malo
Abstract
Using Spanish establishment-level data on temporary and permanent job and worker flows, we examine firms’ relative usage of fixed-term contracts in response to changes in their prior net employment expectations for the short-run and the long-run – viewed as proxies of how a wide variety of future shocks are ultimately perceived by establishments. The employment response of establishments to changing net employment expectations for the short-run is, primarily, suggestive of their reliance on fixed-term contracts as a buffer to cushion short-run changes in demand as well as to shield permanent workers from downward workforce adjustments. In contrast, their response to changes in net employment expectations for the long-run mostly hints on the use of fixed-term contracts as a screening device. Therefore, policies providing financial incentives to convert fixed-term into permanent contracts – thus targeting firms’ using fixed-term contracts as a screening device, are likely to only have limited effectiveness.

Suggested Citation

  • Catalina Amuedo-Dorantes & Miguel Á. Malo, 2008. "How are fixed-term contracts used by firms? An analysis using gross job and worker flows," Research in Labor Economics, in: Work, Earnings and Other Aspects of the Employment Relation, pages 277-304, Emerald Group Publishing Limited.
    • Handle: RePEc:eme:rleczz:s0147-9121(08)28009-x
    DOI: 10.1016/S0147-9121(08)28009-X
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    Cited by:

    1. Dragos Adascalitei & Sameer Khatiwada & Miguel Á. Malo & Pignatti Moran, 2015. "Employment protection and collective bargaining during the great recession: a comprehensive review of international evidence," Revista de Economía Laboral - Spanish Journal of Labour Economics, Asociación Española de Economía Laboral - AEET, vol. 12, pages 50-87.
    2. Bachmann Ronald & Bredtmann Julia, 2016. "Die Rolle befristeter Beschäftigung in Europa," Zeitschrift für Wirtschaftspolitik, De Gruyter, vol. 65(3), pages 270-298, December.
    3. García Serrano, Carlos. & Malo, Miguel Ángel., 2013. "Beyond the contract type segmentation in Spain : country case studies on labour market segmentation," ILO Working Papers 994814983402676, International Labour Organization.
    4. repec:ilo:ilowps:481498 is not listed on IDEAS

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