Autori
Berton, Fabio
Migheli, Matteo

Titolo
Estimating the marginal rate of substitution between wage and employment protection
Periodico
Università degli studi di Torino. Dip. Di Economia e Statistica Cognetti de Martiis. Working paper series
Anno: 2015 - Volume: 7 - Fascicolo: 29 - Pagina iniziale: 1 - Pagina finale: 32

Empirical evidence supports the hypothesis that workers have a strong preference for job security. Building on this, the empirical research focused so far on the analysis of the “port-of-entry hypothesis” – namely on testing whether temporary jobs may act as a springboard towards standard employment relationships – underexploring the issue of what would make workers indifferent between the two options. This is the aim of the present paper. Using a dedicated survey on a random sample of workers from the Italian public employment service, we find that: i)workers actually require a monetary compensation to trade a non-standard job for a standard one; ii) moreover, they display lexicographic preferences over contracts, inasmuch as when they have tocompare an open-ended contract to a freelance contract (chosen as the epitome of precariousness in Italy), the compensation they ask for does not depend on contract duration; on the opposite, when they compare open-ended jobs to fixed-term jobs (where only expected duration actually matters) the required compensation does not depend on the type of contract, but only on its planned duration; iii) the estimated MRS between wage and contract duration is 257 more Euros per month to accept a one-year shorter employment relationship.



Testo completo: http://www.est.unito.it/do/home.pl/Download?doc=/allegati/wp2015dip/wp_29_2015.pdf

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