Employment Protection and Product Market Competition
Sebastian G. Kessing
Wissenschaftszentrum Berlin fuer Sozialforschung (WZB) - Market Processes and Governance; CESifo (Center for Economic Studies and Ifo Institute for Economic Research)
Scandinavian Journal of Economics, Vol. 108, No. 2, pp. 339-352, July 2006
A firm facing employment protection will defend its market position more fiercely than a rival firm operating without such restrictions. However, ex ante such firms may be more reluctant to expand. For the benchmark case of contest competition, the defensive effect dominates. A firm facing employment protection has a stronger average market position.
Number of Pages in PDF File: 14Accepted Paper Series
Date posted: August 16, 2006
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