TY  - RPRT
        AU  - Bottasso, Anna
AU  - Bratti, Massimiliano
AU  - Cardullo, Gabriele
AU  - Conti, Maurizio
AU  - Sulis, Giovanni
        TI  - Labor Market Regulation and Firm Adjustments in Skill Demand
        PY  - 2023/Jun/
        PB  - Institute of Labor Economics (IZA)
        CY  - Bonn
        T2  - IZA Discussion Paper
        IS  - 16262
        UR  - https://www.iza.org/publications/dp16262
        AB  - We study how changes in labor market regulation may trigger firm adjustments in skill demand. Leveraging rich administrative data from Italy, we investigate the effects of a reform that reduced firing costs for permanent employees and tightened temporary contracts' regulation to increase job stability. By using a difference-in-differences design, we document that the reform had unintended effects, inducing firms to increase layoffs of unskilled permanent employees and reducing hirings of unskilled workers on temporary contracts, but had no effect on skilled workers or permanent hirings. A theoretical search and matching model with heterogeneous skills and contract durations rationalizes our main findings.

        KW  - skill demand
KW  - labor market regulation
KW  - employment protection
KW  - temporary work
KW  - worker flows
        ER  -