Introducing Flexicurity: Labor Market Effects of a Unemployment Insurance Reform and Severance Pay
with E. Coschignano, J. Garcia-Louzao, J. Jessen, and R. Jessen
(June 2026)
Manuscript coming soon
Bargaining over severance: evidence from employment protection reform in Lithuania
with Joanna Tyrowicz (University of Regensburg)
(June 2024)
Abstract: This paper quantifies workers' bargaining power in negotiations with employers regarding severance pay. Our identification strategy relies on a labor code reform in Lithuania, significantly reducing the surplus available for negotiation between employers and employees. Utilizing detailed administrative records we provide difference-in-difference estimates of bargaining power of the workers. Our findings reveal that employees extract a sizable income at contract termination. Additionally, we document considerable variation in bargaining power among workers. In addition, our analysis does not support the notion that women negotiate differently than men.
Manuscript coming soon