Have Labor Market Reforms at the Turn of the Millennium Changed the Job and Employment Durations of new Entrants? A Comparative Study for Germany and Italy

Many European countries during the 1990s and early 2000s tried to raise labor market flexibility by relaxing their employment protection legislation. This paper investigates whether the reforms have influenced job and employment stability for labor market entrants in Germany and Italy. Duration models are estimated using comparable administrative data for the two countries. The results provide, to some extent, evidence of a decrease in job stability. However, this is not accompanied by a compensating increase in employment stability during the first 3 years after labor market entry.