Arbeitspapier
Earnings-related severance pay
In an efficiency wage economy, lump-sum severance pay from which shirkers can be excluded raises employment. However, severance payments are usually related to wages. It is shown that earnings-related, mandated severance pay will have ambiguous employment effects if effort can be varied continuously. A substitution of the earnings-related for the lump-sum component reduces employment. Thus, the prevalent form of severance payments in OECD countries might have less advantageous employment effects than previously conjectured.
- Language
-
Englisch
- Bibliographic citation
-
Series: IZA Discussion Papers ; No. 2232
- Classification
-
Wirtschaft
Nonwage Labor Costs and Benefits; Retirement Plans; Private Pensions
Labor Contracts
Unemployment Insurance; Severance Pay; Plant Closings
- Subject
-
earnings relationship
efficiency wages
employment
severance pay
Effizienzlohn
Abfindung
Beschäftigung
Theorie
- Event
-
Geistige Schöpfung
- (who)
-
Goerke, Laszlo
- Event
-
Veröffentlichung
- (who)
-
Institute for the Study of Labor (IZA)
- (where)
-
Bonn
- (when)
-
2006
- Handle
- Last update
-
10.03.2025, 11:41 AM CET
Data provider
This object is provided by:
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
Object type
- Arbeitspapier
Associated
- Goerke, Laszlo
- Institute for the Study of Labor (IZA)
Time of origin
- 2006
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