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Identifying the Substitution Effect of Temporary Agency Employment

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Jahn, Elke ; Weber, Enzo
Date of publication of this fulltext: 20 Mar 2012 11:29


This paper fills a gap in the literature by investigating whether temporary agency employment substitutes regular employment. To take into account the interaction between the two employment forms, we identify a SVAR model with correlated innovations by volatility regimes. We show that a positive shock to temporary agency employment increases overall employment, but also leads to substitution of regular jobs.

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