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Essays on temporary work agencies and the economic analysis of law
Umeå University, Faculty of Social Sciences, Umeå School of Business and Economics (USBE), Economics.ORCID iD: 0000-0003-1071-5774
2014 (English)Doctoral thesis, comprehensive summary (Other academic)
Abstract [en]

This thesis consists of an introductory chapter and four self-contained papers on temporary work agenciesand the economic analysis of law.

Paper [I] adds to the theoretical literature on the incentives of Temporary Work Agencies (TWAs). Using aprincipal-agent model with hidden action to model two main types of contracts between a TWA and a ClientFirm (CF), the TWA is shown to potentially act against the best interest of the CF when helping to fill avacant position. The results also suggest that the adverse effect of the incentive misalignment is larger whenthe worker is going to be leased instead of hired by the CF. However, this effect could potentially be offsetby introducing a sufficient level of competition among the TWAs.

Paper [II] uses individual-level data on young adults to estimate how the probability of being employed inthe Swedish temporary agency sector is affected by whether a partner or other family member has experienceof temporary agency work. The results show a significant effect from all peer groups of a magnitude thatcorrespond to the other most influential control variables. We also find that this cohort of the agency sectorhas a relatively high education level compared to the regular sector, and that there are predominately menworking in thissector.

Paper [III] analyses possible effects on total employment, and the distribution between agency work andregular contracts as a consequence of the implementation of the EU Temporary and Agency Workers Directive in Sweden. The analysis is based on changes in the compensation to agency workers in a calibratedextension of a Mortensen-Pissarides search model. Even though the results suggest a negative net effect ontotal employment, the implementation is shown to increase (utilitarian) welfare, and an increased transitionprobability from the agency sector into regular employment will increase welfare even further.

Paper [IV] focuses on settlement probabilities for different types of representation within the Swedish LabourCourt. Empirical estimates on a set of unjust dismissal cases show that private representatives are generallyless likely to reach a settlement than their union counterparts. The settlement probabilities converge following court-mandated information disclosure, which suggests that information asymmetry is an importantfactor in explaining differences in settlement behaviour. Privately instigated negotiations are therefore ingeneral insufficient for making cases with non-union representation reach the same settlement rate as caseswith union representation.

Place, publisher, year, edition, pages
Umeå: Umeå universitet , 2014. , 23 p.
Series
Umeå economic studies, ISSN 0348-1018 ; 897
Keyword [en]
temporary work agency, family work experience, young adults, Sweden, labour law, EU direc- tive, unemployment, unjust dismissals, negotiations, settlements, labour unions
National Category
Economics
Research subject
Economics
Identifiers
URN: urn:nbn:se:umu:diva-95474ISBN: 978-91-7601-152-2 (print)OAI: oai:DiVA.org:umu-95474DiVA: diva2:759536
Public defence
2014-11-21, S213h, Samhällsvetarhuset, Umeå universitet, Umeå, 13:15 (English)
Opponent
Supervisors
Available from: 2014-10-31 Created: 2014-10-29 Last updated: 2014-10-30Bibliographically approved
List of papers
1. The Misaligned Incentives of Temporary Work Agencies and their Client Firms
Open this publication in new window or tab >>The Misaligned Incentives of Temporary Work Agencies and their Client Firms
2014 (English)Report (Other academic)
Abstract [en]

This paper adds to the theoretical literature on the incentives of Temporary Work Agencies (TWAs). Using a principal-agent model with hidden action to analyse two main types of contracts between a TWA and a Client Firm (CF), the TWA is shown to potentially act against the best interest of the CF when helping to fill a vacant position. The results also suggest that the adverse effect of the incentive misalignment is larger when workers are leased rather than hired by the CF. However, this effect could potentially be offset by introducing a sufficient level of competition among TWAs. 

Place, publisher, year, edition, pages
Umeå: Umeå universitet, 2014. 18 p.
Series
Umeå economic studies, ISSN 0348-1018 ; 896
Keyword
temporary work agency, client firm, incentives, matching, contracts
National Category
Economics
Research subject
Economics
Identifiers
urn:nbn:se:umu:diva-95356 (URN)
Available from: 2014-10-28 Created: 2014-10-28 Last updated: 2016-08-17Bibliographically approved
2. Young Adults in the Swedish Temporary Agency Sector: Implications of Family Experience
Open this publication in new window or tab >>Young Adults in the Swedish Temporary Agency Sector: Implications of Family Experience
2014 (English)Report (Other academic)
Abstract [en]

A persons first experience of working life is not the individuals actual first job, but rather the perception conveyed by his or her family and other reference groups. Using Swedish register data on young adults (aged 18-34), and controlling for personal characteristics, we find that individuals with family members or partners with work experience from the temporary agency sector are highly over-represented in the sector. The peer-groups previous experience is also found to be among the most influential variables determining the relative probability that an individual will work in the temporary agency sector. 

Place, publisher, year, edition, pages
Umeå: Umeå universitet, 2014. 28 p.
Series
Umeå economic studies, ISSN 0348-1018 ; 888
Keyword
Temporary work agency, family work experience, young adults, Sweden
National Category
Economics
Research subject
Economics
Identifiers
urn:nbn:se:umu:diva-95349 (URN)
Available from: 2014-10-28 Created: 2014-10-28 Last updated: 2016-08-17Bibliographically approved
3. Employment effects of the EU temporary and agency workers directive in Sweden
Open this publication in new window or tab >>Employment effects of the EU temporary and agency workers directive in Sweden
2014 (English)Report (Other academic)
Abstract [en]

This paper analyses possible effects on total employment, and the distribution between agency work and regular contracts as a consequence of the Swedish implementation of the EU Temporary and Agency Workers Directive in a dual labour market Mortensen-Pissarides search model. The directive states that the basic working and employment conditions for agency workers should be equal to those for a comparable employee at the client firm, and that all parties should actively facilitate the transition from agency employment to employment directly at the client firm. Even though the results suggest a negative net effect on total employment, the implementation is shown to have a positive impact on overall welfare, and that an increased transition probability from the agency sector into regular employment would contribute even more.

Place, publisher, year, edition, pages
Umeå: Umeå universitet, 2014. 23 p.
Series
Umeå economic studies, ISSN 0348-1018 ; 887
Keyword
Labour law, EU directive implementation, temporary agency work, unemployment
National Category
Economics
Research subject
Economics
Identifiers
urn:nbn:se:umu:diva-95348 (URN)
Available from: 2014-10-28 Created: 2014-10-28 Last updated: 2014-10-30Bibliographically approved
4. Settlement probability asymmetries in the Swedish Labour Court
Open this publication in new window or tab >>Settlement probability asymmetries in the Swedish Labour Court
2014 (English)In: European Journal of Law and Economics, ISSN 0929-1261, E-ISSN 1572-9990, Vol. 38, no 3, 485-512 p.Article in journal (Refereed) Published
Abstract [en]

This paper focuses on settlement probabilities for different types of representation within the Swedish Labour Court. Empirical estimates on a set of cases concerned with unjust dismissals show that private representatives are generally less likely to reach a settlement than their union counterparts. The settlement probabilities converge following court-mandated information disclosure, which suggests that information asymmetry is an important factor in explaining differences in settlement behaviour and that private negotiations are not sufficient in general.

Place, publisher, year, edition, pages
New York: , 2014
Keyword
unjust dismissals, negotiations, settlements, trade unions
National Category
Economics
Research subject
Economics
Identifiers
urn:nbn:se:umu:diva-95350 (URN)10.1007/s10657-013-9397-9 (DOI)2-s2.0-84877901734 (Scopus ID)
Available from: 2014-10-28 Created: 2014-10-28 Last updated: 2017-12-05Bibliographically approved

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