2017

Direct and Cross Effects of Employment Protection: The Case of Parental Childcare

Reprint No. 2017:58

Author(s): Martin OlssonYear: 2017 Title: Scandinavian Journal of Economics Volume (No.): 119 (4) Pages: 1105–1128
Online article (restrictions may apply)


I examine whether employment protection affects the willingness of working parents to provide childcare. Using a reform that made it easier for employers to dismiss workers in small firms, I find that softer employment protection reduces the use of temporary parental leave among directly treated fathers. In addition, I find that households respond to an increase in the dismissal risk by reducing temporary parental leave for the indirectly treated spouse. Spousal labor supply can thus serve as informal insurance against adverse income shocks.


Reference:
Olsson, Martin (2017), "Direct and Cross Effects of Employment Protection: The Case of Parental Childcare". Scandinavian Journal of Economics 119(4), 1105–1128.

Martin Olsson

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