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This paper evaluates the implications for employment, productivity and wages of allowing for more flexibility in weekly hours worked introduced in the recent Spanish labour market reform ("the 2012 reform"). A crucial aspect of the model will be the extent to which firms will be able to choose...
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and in the labor services they provide. Firms offer tied wage-hours packages to workers, who choose among these packages … linear over the traded commodities. I show that an employment tax on high-wage workers has substantially different effects on … the employment and wages of low-wage and high-wage workers when team production is explicitly modeled compared to a case …
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