Économie et Statistique n° 372 - 2004 Donating time: volunteers in the organised civil sector - How do employees perceive employment protection? - The Delalande contribution and transitions on the labour market - Evaluating the profitability of non-financial firms

Economie et Statistique
Paru le : 01/02/2005

The Delalande contribution and transitions on the labour market

Luc Behaghel, Bruno Crépon et Béatrice Sédillot

The Delalande tax was introduced in 1987 to discourage companies from laying off workers over 50 years old. However, there are adverse effects to such a system. Among other things, it can encourage firms to avoid hiring older workers so as not to risk being liable for this tax at a later date. This paper empirically evaluates the different effects on hirings and firings, drawing on the many changes made to the mechanism. The effect of cutting back on hiring older workers is studied on the basis of a change in 1992, which made workers hired after the age of 50 exempt from the scheme. In keeping with the theoretical predictions, we observe an improvement in the chances of returning to work for jobseekers over 50 compared with jobseekers under 50. This development does not appear to be due to other attendant changes such as the introduction of government-subsidised contracts for jobseekers over 50. Yet redundancies have a lesser, or at least less discernable, effect: firms' redundancy decisions are thought to be not very sensitive to the sharp variations in the Delalande contribution scale.

Economie et Statistique

No 372

Paru le : 01/02/2005