Travail et économie publique externe

Du 02/02/2017 de 13:00 à 14:30

Salle 10, RDC Bâtiment G, Campus Jourdan, 48 boulevard Jourdan, 75014 Paris

ZWEIMULLER Josef (University of Zurich)

Job Mobility and Creative Destruction: Flexicurity in the Land of Schumpeter

This paper studies how a major policy change in Austria – the introduction of mandatory occupational pensions and the abolition of employer-provided severance pay – affects job mobility. The new rules were applied to employment relationships that started on January 1, 2003 or later, whereas jobs having started before that date continued to be subject to the old system. The new rules brought about two major changes. First, under the old system only laid-off workers were subject to a severance payment, whereas under the new system both quitters and laid-off workers are able to transfer their pension account with the associated separation payment to a new employer. Second, the system abolishes a discontinuous payment scheme (with severance payments jumping at tenure thresholds) to a continuous payment scheme (with monthly employer contributions smoothly increasing the balance on one’s pension account). We find that workers subject to the new system are more than 20 percent more likely to leave a distressed firm (where a plant closure or a mass layoff will take place in the near future) than workers subject to the old system in a similar situation. We set up a model of on-the-job-search in which demand shocks to firms generate heterogeneous layoff probabilities, predicting that workers are more likely to leave when their firm is in a bad shape. Estimating the model by Simulated Method of Moments, we study the quantitative response in job mobility when a voluntary quit (but not a layoff) is penalized with loss of a payment upon job separation compared to a situation where this is not the case. We find that the estimated model can fit the mobility response generated through abolishing severance pay and introducing occupations pension under realistic parameter values.