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Stricter employment protection and firms' incentives to train: The case of French older workers

Author

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  • Pierre-Jean Messe

    (TEPP - Travail, Emploi et Politiques Publiques - UPEM - Université Paris-Est Marne-la-Vallée - CNRS - Centre National de la Recherche Scientifique, LEMNA - Laboratoire d'économie et de management de Nantes Atlantique - IEMN-IAE Nantes - Institut d'Économie et de Management de Nantes - Institut d'Administration des Entreprises - Nantes - UN - Université de Nantes, GAINS - Groupe d'Analyse des Itinéraires et des Niveaux Salariaux - UM - Le Mans Université)

  • Bénédicte Rouland

    (TEPP - Travail, Emploi et Politiques Publiques - UPEM - Université Paris-Est Marne-la-Vallée - CNRS - Centre National de la Recherche Scientifique, GAINS - Groupe d'Analyse des Itinéraires et des Niveaux Salariaux - UM - Le Mans Université)

Abstract

From French data, this paper uses a difference-in-differences approach combined with propensity score matching to identify the effect of an exogenous change in employment protection among older workers on firm's incentives to provide training. Laying off workers aged 50 and above, French firms have to pay a tax to the unemployment insurance system, known as the Delalande tax. In 1999, the measure was subjected to a reform that increased due taxes but that did not concern equally all firms. We find that this exogenous shock to employment protection for older workers substantially rises firms' incentives to train the 45-49 age group of workers. This result confirms predictions of the simple labor market model we develop in a first stage.

Suggested Citation

  • Pierre-Jean Messe & Bénédicte Rouland, 2012. "Stricter employment protection and firms' incentives to train: The case of French older workers," Working Papers halshs-00856132, HAL.
    • Handle: RePEc:hal:wpaper:halshs-00856132
    Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-00856132
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    References listed on IDEAS

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    Cited by:

    1. Ann Barbara Bauer & Reiner Eichenberger, 2017. "Endogenous aging: How statutory retirement age drives human and social capital," CREMA Working Paper Series 2017-02, Center for Research in Economics, Management and the Arts (CREMA).

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