The Effect of Employment Protection on Firms’ Worker Selection
研究瑞典一项降低解雇成本的改革，发现企业降低了最低招聘质量约2%，并更多雇佣年轻人、外国出生者和长期失业者，可能带来福利收益。
<h3>Abstract</h3> To estimate the causal effect of employment protection on firms' worker selection, we study a policy change that reduced dismissal costs for the employers of over a tenth of Sweden's workforce. Our difference-in-differences analysis of firms' hiring uses individual ability measures including estimated worker fixed effects, GPA at age 15, and military test scores. We find that the reform reduced minimum hire quality by around 2%. Our results show that firms both decreased their hiring thresholds and hired more workers. We find that firms increasingly hired young, foreign born and long-term non-employed individuals, suggesting potential welfare gains from the reform.