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A Q-model of labour demand

Author

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  • Cristina Barceló

    (Banco de España)

Abstract

This paper studies the labour demand using a Q model in which labour and capital entail adjustment costs. The estimates are based on an unbalanced panel of Spanish firms over the period 1989-96. The corresponding Q variable for labour is significant in explaining hiring rates. Its estimated coefficient varies across sectors in a way that suggests that the use of temporary labour is more widespread in those economic sectors that incur smaller costs of adjusting labour factor due to the specific characteristics of their technology and economic activity. Interaction effects between investment and labour demands are also observed in their adjustment costs.

Suggested Citation

  • Cristina Barceló, 2006. "A Q-model of labour demand," Working Papers 0626, Banco de España.
    • Handle: RePEc:bde:wpaper:0626
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    References listed on IDEAS

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    Cited by:

    1. Mustafa akan, 2017. "Optimal Capital and Labor Investment in Price Regulated State Economic Service Enterprises," Proceedings of International Academic Conferences 5908306, International Institute of Social and Economic Sciences.

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    More about this item

    Keywords

    q model; adjustment costs; labour demand; panel data;
    All these keywords.

    JEL classification:

    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • J32 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Nonwage Labor Costs and Benefits; Retirement Plans; Private Pensions
    • E22 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Investment; Capital; Intangible Capital; Capacity

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