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Macro and microeconomic effects of the uncertainty in the labour market legislation

This research project focuses on the micro and macroeconomic effects of uncertainty related to labour market legislation. The aim is to understand how non-permanent changes in labour market legislation affect the employment decisions made by French companies in their intensive and extensive margins. We draw on a dynamic model in which labour legislation affects recruitment and dismissal costs as well as overtime costs. Since these decisions rely on other company-specific and aggregate variables, we also explore how the distributions change over time.