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and the trend rate of productivity growth is small, a rise in firing costs affects mainly the hiring decision. Thus there … growth is large, firing costs affect mainly the firing decision. Then, as a result, average employment is increased. Our …
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A key prediction of dynamic labor demand models is that firing restrictions attenuate firms' employment responses to economic fluctuations. We provide the first direct test of this prediction using data from India. We exploit the fact that rainfall fluctuations, through their effects on...
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This paper explores the influence of on-the-job training on the employment effect of firing costs. It shows that on …-the-job training (generating firm specific skills) causes firing costs to have a contractionary influence on average employment (over …
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