The Relation between Temporary Employment and Firm Ownership Nationality: Evidence from Spain

This paper analyzes the differences on the proportion of temporary employees in the Spanish manufacturing sector according to firm ownership nationality. Standard censored Tobit and Heckman sample selection models are estimated using data from the Survey on Managerial Strategies (ESSE) in the period 1991 to 2005. The results show there is a clear relation between the nationality of the owners of the firm and the type of labor offered, even after controlling for a large number of observable firm characteristics and unobservable fixed effects. In particular, the share of temporary employees is significantly lower for foreign firms and this effect decreases with firm size.