Layoffs in a Recession and Temporary Employment Subsidies when a Recovery is Expected

Sunk firing costs shelter employment – and this effect is typically amplified by uncertainty due to an option value of waiting. Thus, if sunk firing costs are high, e.g. due to a mployment protection legislation, and if recession related losses are with a high probability expected to be only transit...

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Bibliographic Details
Published in:MAGKS - Joint Discussion Paper Series in Economics (Band 29-2010)
Main Author: Göcke, Matthias
Format: Work
Published: Philipps-Universität Marburg 2010
Online Access:PDF Full Text
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