Autore: Borooah, Vani K.
Titolo: Employment inequality, employment regulation and social welfare
Periodico: International Center for Economics Research, Torino. ICER - Working papers series
Anno: 1999 - Fascicolo: 11 - Pagina iniziale: 1 - Pagina finale: 21

This paper develops a model which explains the unequal employment outcomes of two groups - defined as their, respective, likelihoods of successfully filling job vacancies - in terms of disparity in their access to job networks. This disparity arises because a proportion of vacancies are filled using informal methods so that, as a first step, information about vacancies only becomes available through word-of-mouth; as a second step, appointments are based on recommandations of existing emplyees. If society is fragmented, then members of one group will have little or no contact with members of the other group. Therefore, the power to inform and to recommend becomes excessively concentrated in the group that dominates the workforce. In such a situation, the role of fair-employment regulation is to ensure fair access to jobs for all. While this generates equity gains, it could, by raising the costs of hiring and firing, also be accompanied by efficiency losses. Whether social welfare increases or decreases as a resul of regulation depends on tthe relative magnitudes of these gains and losses.





Esportazione dati in Refworks (solo per utenti abilitati)