caa a22 4500 60553439X CHVBK 20210128100842.0 cr unu---uuuuu 210128e20150801xx s 000 0 eng 10.1007/s10663-014-9263-1 doi (NATIONALLICENCE)springer-10.1007/s10663-014-9263-1 A hysteresis model-based indicator for employment adjustment rigidity [Elektronische Daten] [Paulo Mota, José Varejão, Paulo Vasconcelos] The accurate measurement of employment adjustment rigidity is essential to assist labour market reforms that are currently viewed as a key to economic recovery of the Euro Zone peripheral countries. Usually, labour market rigidity is assessed through the researcher's reading of the legislation or other similar measures. In this work we propose a new indicator for labour market rigidity computed from data on the adjustment of employment and hours per worker. We model employment dynamics with a linear play model of hysteresis, which is adequate in the presence of non-convex employment adjustment costs, and derive a switching regression model with a time-varying splitting factor estimated on monthly data for 15 OECD countries and 14years (1995-2008). The numerical results provide an employment rigidity ranking of countries that is neither vulnerable to enforcement issues nor to subjective interpretations of the law. With this new and practical procedure, a single parameter summarizes different labour markets according to their readiness of employment adjustment. Moreover, it is easily computed and updated from publicly available data. Comparing the new proposed ranking with others, used as a benchmark for the rigidity of employment protection legislation, we find a positive and significant association between the common employment protection legislation indices and our employment adjustment indicator. The rank correlations are especially high with the OECD indicators. Yet, our findings indicate that the OECD rankings seem to overstate employment rigidity at the ranking top positions and understate it at the bottom. Springer Science+Business Media New York, 2014 Employment nationallicence Rigidity nationallicence Rankings nationallicence Hysteresis nationallicence Mota Paulo University of Porto, Porto, Portugal aut Varejão José University of Porto, Porto, Portugal aut Vasconcelos Paulo University of Porto, Porto, Portugal aut Empirica Springer US; http://www.springer-ny.com 42/3(2015-08-01), 547-569 0340-8744 42:3<547 2015 42 10663 https://doi.org/10.1007/s10663-014-9263-1 text/html Onlinezugriff via DOI BK010053 XK010053 XK010000 Metadata rights reserved Springer special CC-BY-NC licence nationallicence 1 research-article jats NATIONALLICENCE NATIONALLICENCE NL-springer NATIONALLICENCE 856 40 https://doi.org/10.1007/s10663-014-9263-1 text/html Onlinezugriff via DOI NATIONALLICENCE 700 1- Mota Paulo University of Porto, Porto, Portugal aut NATIONALLICENCE 700 1- Varejão José University of Porto, Porto, Portugal aut NATIONALLICENCE 700 1- Vasconcelos Paulo University of Porto, Porto, Portugal aut NATIONALLICENCE 773 0- Empirica Springer US; http://www.springer-ny.com 42/3(2015-08-01), 547-569 0340-8744 42:3<547 2015 42 10663