IDEAS home Printed from https://ideas.repec.org/p/pri/indrel/444.html
   My bibliography  Save this paper

Let's Go To Court! Firing Costs and Dismissal Conflicts

Author

Listed:
  • Jose E. Galdon-Sanchez

    (London School of Economics)

  • Maia Guell

    (Princeton University and Universitat Pompeu Fabra)

Abstract

In this paper we analyze court outcomes of dismissal conflicts for several countries. We highlight two facts. First, the patterns found are extremely stable in every country over time. Second, two types of patterns are found: either the workers win most of the cases, or the worker and the firm win half the times each. We build a model of dismissal conflicts that explains these facts. The gap between the severance pay for fair and unfair dismissals is a key factor in the determination of such court outcomes. Those countries with a small gap have outcomes in which the workers win most of the time, and the average cost of firing is higher than in those countries with a smaller gap. This suggests that costly dismissals and rigid employment protection legislation are not necessarily synonymous.

Suggested Citation

  • Jose E. Galdon-Sanchez & Maia Guell, 2000. "Let's Go To Court! Firing Costs and Dismissal Conflicts," Working Papers 823, Princeton University, Department of Economics, Industrial Relations Section..
    • Handle: RePEc:pri:indrel:444
    as

    Download full text from publisher

    File URL: https://dataspace.princeton.edu/bitstream/88435/dsp017s75dc371/1/444.pdf
    Download Restriction: no
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Ruiz-Valenzuela, Jenifer, 2020. "Intergenerational effects of employment protection reforms," LSE Research Online Documents on Economics 104016, London School of Economics and Political Science, LSE Library.
    2. Miguel Á. Malo & Ángel Martín-Román & Alfonso Moral, 2018. "“Peer effects” or “quasi-peer effects” in Spanish labour court rulings," European Journal of Law and Economics, Springer, vol. 45(3), pages 497-525, June.
    3. Marco Leonardi & Giovanni Pica, 2013. "Who Pays for it? The Heterogeneous Wage Effects of Employment Protection Legislation," Economic Journal, Royal Economic Society, vol. 123(12), pages 1236-1278, December.
    4. Adriana Kugler & Juan F. Jimeno & Virginia Hernanz, "undated". "Employment Consequences of Restrictive Permanent Contracts: Evidence from Spanish Labor Market Reforms," Working Papers 2003-14, FEDEA.
    5. Antje Mertens & Vanessa Gash & Frances McGinnity, 2007. "The Cost of Flexibility at the Margin. Comparing the Wage Penalty for Fixed‐term Contracts in Germany and Spain using Quantile Regression," LABOUR, CEIS, vol. 21(4‐5), pages 637-666, December.
    6. Andrew Benito & Ignacio Hernando, 2003. "Labour demand, flexible contracts and financial factors: new evidence from Spain," Working Papers 0312, Banco de España.
    7. Camille Signoretto & Julie Valentin, 2019. "Individual dismissals for personal and economic reasons in French firms: One or two models?," European Journal of Law and Economics, Springer, vol. 48(2), pages 241-265, October.
    8. Garibaldi, Pietro & Violante, Giovanni, 2002. "Firing Tax and Severance Payment in Search Economies: A Comparison," CEPR Discussion Papers 3636, C.E.P.R. Discussion Papers.
    9. Ruiz-Valenzuela, Jenifer, 2020. "Intergenerational effects of employment protection reforms," Labour Economics, Elsevier, vol. 62(C).

    More about this item

    Keywords

    dismissal conflicts; worker; firm court;
    All these keywords.

    JEL classification:

    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
    • O41 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models
    • O42 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Monetary Growth Models

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pri:indrel:444. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Bobray Bordelon (email available below). General contact details of provider: https://edirc.repec.org/data/irprius.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.