The Impact of the Employment Protection Legislation Reform on the Labor Market’s Flexicurity in Morocco

Saïd TOUFIK, Mohammed-Amine ARKHIS, Youssef OUKHALLOU, Saâd El Baghdadi El BAGDADI

Abstract


Abstract. This paper uses the OECD’s methodology to build an Employment Protection Legislation index (EPL) for the Moroccan economy. In this framework, the main objective is to assess the impact of the new Labor Code’s provisions on the degree of flexicurity in the labor market. The paper also investigates the approximate influence of the EPL changes as regards to some employment-related variables. Our results show that after the 2004 Labor Code reform, the labor market’s flexibility level went down from 75 percent to 44 percent, as EPL became significantly stricter. Furthermore, our analysis suggests that the new legislation, although it brought relatively strict restrictions on hiring and firing, generated a significant increase in dismissals during the three first years of its implementation. And unlike the buckle of conventional literature and several empirical findings, the unemployment rate actually dropped, allegedly backed-up by a solid GDP growth during the 2000’s.

Keywords. Labor Market, Flexicurity, Employment Protection.

JEL. K31, E24, J81.


Keywords


Labor Market; Flexicurity; Employment Protection.

Full Text:


References


Agénor, P.R., & El Aynaoui, K. (2003). Labor market policies and unemployment in Morocco: A quantitative analysis, World Bank Policy Research Paper No.3091. doi. 10.1596/1813-9450-3091

Allard, G.J. (2005). Measuring job security over time: in search of a historical indicator for EPL (Employment Protection Legislation). Instituto de Empresa Business School, Working Paper No.WP05-17. doi. 10.2139/ssrn.1016327

Banker, R.D., Byzalov, D., & Chen, L.T. (2013). Employment protection legislation, adjustment costs and cross-country differences in cost behavior, Journal of Accounting and Economics, 55(1), 111-127. doi. 10.1016/j.jacceco.2012.08.003

Barbieri, P., & Cutuli, G. (2015). Employment protection legislation, labour market dualism, and inequality in Europe, European Sociological Review, 32(4), 501-516. doi. 10.1093/esr/jcv058

Bekker, S., Wilthagen, T., Madsen, P.K., Zhou, J., Rogowski, R., Keune, M., & Tangian, A. (2008). Flexicurity–a European approach to labor market policy, Intereconomics, 43(2), 68-111. doi. 10.1007/s10272-008-0244-0

Blanchard, O., & Wolfers, J. (2000). The role of shocks and institutions in the rise of European unemployment: The aggregate evidence, Economic Journal, 110(462), 1-33. doi. 10.1111/1468-0297.00518

Botero, J.C., Djankov, S., La Porta, R., de Silanes, F.L, & Shleifer, A. (2003). The regulation of labor, NBER Working Paper, No.9756. doi. 10.3386/w9756

Dahirs, laws and government decrees related to labor protection in Morocco from 1921 to 2004.

Di Tella, R., & MacCulloch, R. (2005). The consequences of labor market flexibility: Panel evidence based on survey data, European Economic Review, 49(5), 1225-1259. doi. 10.2139/ssrn.431140

Garibaldi, P., Pacelli, L., & Borgarello, A. (2004). Employment protection legislation and the size of firms, Giornaledeglieconomisti e annali di economia, 33-68. doi. 10.2139/ssrn.472762

Heckman, J.J., & Pages, C. (2000). The cost of job security regulation: evidence from Latin American labor markets, NBER, Working Paper, No.7773. doi. 10.3386/w7773

Labor Code of the Kingdom of Morocco (Law No 65 – 99, 2004).

Layard, P.R.G., Nickell, S.J., & Jackman, R. (2005). Unemployment: macroeconomic performance and the labor market, Oxford University Press. doi. 10.1093/acprof:oso/9780199279166.001.0001

Lazear, E.P. (1990). Job security provisions and employment, The Quarterly Journal of Economics, 105(3), 699-726. doi. 10.2307/2937895

Mortensen, D.T. (1986). Job search and labor market analysis. Handbook of Labor Economics, 2, 849-919. doi. 10.1016/s1573-4463(86)02005-9

Nicoletti, G., Scarpetta, S., & Boylaud, O. (2000). Summary indicators of product market regulation with an extension to employment protection legislation, OECD Economic Department Working Papers, No.226. doi. 10.1787/215182844604

OECD/OCDE, (2004), Réglementation relative à la protection de l’emploi et performance du marché du travail. [Retrieved from].

OECD, (2004), OECD Employment Outlook 2004, Paris. doi. 10.1787/empl_outlook-2004-4-fr

Skedinger, P. (2010). Employment protection legislation: Evolution, effects, winners and losers, Edward Elgar Publishing. doi. https://doi.org/10.4337/9781849805599

Tangian, A.S. (2011). Not for bad weather: Macroanalysis of Flexicurity with regard to the crisis”. ETUI Policy Brief, ETUI Working Paper, No.2010.06. doi. 10.2139/ssrn.2264053




DOI: http://dx.doi.org/10.1453/jsas.v4i1.1174

Refbacks

  • There are currently no refbacks.


Bookmark and Share


....................................................................................................................................................................................................................................................................................................................................... Journal of Social and Administrative Sciences - J. Adm. Soc. Sci. - JSAS - www.kspjournals.org

ISSN: 2149-0406

Editor: editor-jsas@kspjournals.org   Secretarial: secretarial@kspjournals.org   Istanbul - Turkey.

Copyright © KSP Library