The costs of wrongful-discharge laws

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Last edited by MARC Bot
July 14, 2020 | History

The costs of wrongful-discharge laws

We estimate the effects on employment and wages of wrongful-discharge protections in the United States. Over the last three decades, most U.S. state courts have adopted one or more common law wrongful-discharge doctrines that limit employers' discretion to terminate workers at-will. Using this cross-state variation with a difference-in-difference framework, we find robust evidence of a modest negative impact (-0.8 to -1.6 percentage points) of one wrongful-discharge doctrine, the implied-contract exception, on employment to population rates in state labor markets. The short-term impact is most pronounced for female, younger, and less-skilled workers, while the longer term costs appear to be borne by older and more-educated workers - those most likely to litigate under this doctrine. We find no robust employment or wage effects of two other widely recognized wrongful-discharge laws: the public-policy and good-faith exceptions. Published findings in the literature range from no effect to very large negative effects. We re-analyze the two leading studies and find the discrepancies can be explained by methodological shortcomings in the one case and limitations in the coding of key court decisions in the other. Keywords: Employment Protection, Wrongful Discharge, Unjust Dismissal, Employment at Will, Labor Law, Instrumental Variables. JEL Classification: E24, J23, J32, J38, J83, K12, K31.

Publish Date
Language
English
Pages
32

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Cover of: The costs of wrongful-discharge laws
The costs of wrongful-discharge laws
2002, Massachusetts Institute of Technology, Dept. of Economics
in English

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Edition Notes

"November 18, 2002."; " ... revised from July 2001"--Abstract.

Includes bibliographical references (p. 31-33).

Abstract in HTML and working paper for download in PDF available via World Wide Web at the Social Science Research Network.

Published in
Cambridge, MA
Series
Working paper series / Massachusetts Institute of Technology, Dept. of Economics -- working paper 02-41, Working paper (Massachusetts Institute of Technology. Dept. of Economics) -- no. 02-41.

The Physical Object

Pagination
32, [24] p. :
Number of pages
32

ID Numbers

Open Library
OL24639989M
Internet Archive
costsofwrongfuld00auto
OCLC/WorldCat
51797871

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Internet Archive item record

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July 14, 2020 Edited by MARC Bot remove fake subjects
April 30, 2011 Created by ImportBot initial import