This paper examines the application of labour law in micro and small enterprises (MSEs) by comparing the practices in various member States of the ILO. Extending the coverage of labour law to numerous MSEs has been problematic in several countries largely due to practical reasons of the limited...

Stringent labor laws can provide firms a commitment device to not punish short-run failures and thereby spur their employees to pursue value-enhancing innovative activities. Using patents and citations as proxies for innovation, we identify this effect by exploiting the time-series variation...

We provide empirical evidence that strong dismissal laws appear to have a positive effect on the innovative pursuits of firms and their employees. Stringent labor laws provide firms a commitment device to not punish short-run failures and thereby spur their employees to pursue value-enhancing...