Separating Introduction Effects from Selectivity Effects: The Differences in Employment Patterns of Codetermined Firms
19 Pages Posted: 8 Feb 2018
Date Written: March 2018
Abstract
This study examines differences in employment growth between firms with and without works councils by separating introduction effects from potential selectivity effects. Using a difference‐in‐differences framework, we show that firms with works councils have higher employment growth before adopting a works council. However, employment growth declines after introduction. We identify the reason for lower employment growth in reduced hiring rates, while dismissal rates remain constant.
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Separating Introduction Effects from Selectivity Effects: The Differences in Employment Patterns of Codetermined Firms
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