Can wrongful discharge law enhance employment?

W. Bentley Macleod, Voraprapa Nakavachara

Research output: Contribution to journalArticlepeer-review

41 Scopus citations

Abstract

The extent of government in private contractual relationships is a vexing public policy issue. This article explores, both theoretically and empirically, the degree to which such intervention may enhance employment. Economists traditionally have held that interventions such as wrongful discharge protections simply undo the original intent of the parties to an employment contract. We find that both good faith as well as implied contract exceptions to employment-at-will may enhance employment, particularly in occupations characterised by high levels of investment and skill. This suggests that under the appropriate conditions, labour law may enhance the operation of a competitive market.

Original languageEnglish (US)
Pages (from-to)F218-F278
JournalEconomic Journal
Volume117
Issue number521
DOIs
StatePublished - Jun 2007
Externally publishedYes

All Science Journal Classification (ASJC) codes

  • Economics and Econometrics

Fingerprint

Dive into the research topics of 'Can wrongful discharge law enhance employment?'. Together they form a unique fingerprint.

Cite this