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Employment Protection Legislation and the IT-Sector in OECD Countries

Published online by Cambridge University Press:  17 August 2016

José E. Galdón-Sánchez
José E. Galdón-Sánchez*
Affiliation:
Universidad Pública de Navarra
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Summary

This paper explores the relationship between employment protection legislation (EPL) and the share of employment in the IT sector. Evidence from several OECD countries suggests that the importance of the IT sector is smaller in economies with high levels of EPL than in economies with low levels. This shows up in the amount of resources dedicated to research on IT as well as in the share of employment in the sector. A simple model is provided to explain these facts. EPL affects both labor supply and labor demand in the same way resulting in lower employment equilibrium levels.

Résumé

Résumé

Cet article traite de la relation entre la législation sur la protection de l’emploi (EPL) et la part de l’emploi dans le secteur des technologies de l’information. Les statistiques de plusieurs pages de pays de l’OCDE tendent à montrer que ce secteur est moins important dans les économies disposant d’une forte législation sur la protection de l’emploi. Ceci apparaît dans le montant des ressources consacrées à la recherche ainsi que dans la part de l’emploi de ce secteur. Nous présentons un modèle simple expliquant ces faits. L’EPL affecte de la même façon l’offre et la demande de travail ce qui se traduit par des niveaux d’emploi plus faibles.

Keywords

new economyinformation technologyunemployment durationJ32J64O3Nouvelle économieTechnologies de l’informationDurée du chômageJ32J64O3
Type
II. Labor Economics and Human Capital Investments
Information
Recherches Économiques de Louvain/ Louvain Economic Review , Volume 68 , Special Issue 1-2: The New Economy: Implications and Viability , 2002 , pp. 169 - 184
Copyright
Copyright © Université catholique de Louvain, Institut de recherches économiques et sociales 2002 

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Footnotes

*

I thank César Alonso, Maia Güell and two anonymous referees for very helpful comments. I acknowledge financial support from the DGICYT P98-0139 and the Departemento de Educación y Cultura of the Gobierno de Navarra. Address : Universidad Pública de Navarra, Department of Economics, Campus Arrosadía, 31006 Pamplona, Navarra, Spain. Email : jose.galdon@unavarra.es

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