AIAS Lunch Seminar 12 december - Wiljan van den Berge (CPB)

Day: Thursday December 12th 2013
Time: 12.15 – 13.15 hrs.
Location: AIAS, 3rd floor, M building, Plantage Muidergracht 12, Amsterdam
Registration: Please send an email, preferably before Wednesday 11th 12.00 to register.
A sandwich will then be provided

Displaced workers and the effects of outplacement and severance pay

Wiljan van den Berge


Abstract

I use a dataset with social plans from firms from the Netherlands covering 8,751 displaced workers to estimate the effects of outplacement and severance pay on a displaced worker’s probability of moving from job to job, the hazard rate and the quality of the subsequent job. I find that both severance pay and outplacement are not associated with a higher average probability of moving from job to job or a higher exit rate out of unemployment for those who do experience an unemployment spell. However, outplacement does seem to be effective for elderly workers in reducing unemployment durations. In addition I find (i) that severance pay is associated with a slightly higher exit rate out of unemployment on average, which likely indicates a selection effect, and (ii) little evidence of average effects of either outplacement or severance pay on subsequent job quality, except for a positive effect of outplacement on the wages of younger workers, which suggests heterogeneous effects of outplacement.

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