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The effect of employment protection legislation and financial market imperfections on investment : evidence from a firm-level panel of EU countries

Cingano, Federico; Leonardi, Marco; Messina, Julián; … - 2009

This paper analyzes the joint effect of EPL and financial market imperfections on investment, capital-labour substitution, labour productivity and job reallocation in a cross-country framework. In the spirit of Rajan and Zingales (1998) and Ciccone and Papaioannou (2006), we exploit variation in...