The full-text may be used and/or reproduced, and given to third parties in any format or medium, without prior permission or charge, for personal research or study, educational, or not-for-pro t purposes provided that:• a full bibliographic reference is made to the original source • a link is made to the metadata record in DRO • the full-text is not changed in any way The full-text must not be sold in any format or medium without the formal permission of the copyright holders.Please consult the full DRO policy for further details.
AbstractUsing recently developed indicators of the strictness of employment protection legislation in OECD countries, the paper examines the issue of whether strict employment protection legislation may promote self-employment by encouraging employers to contract-out work to self-employed workers. Contrary to the results of previous studies, the paper finds little evidence for a positive relationship between self-employment and the strictness of EPL. While the raw data suggest that a positive relationship may indeed exist, once suitable control variables are introduced into the analysis, it appears that if anything, the opposite may be true: i.e. stricter employment protection legislation may actually reduce self-employment.JEL Codes: J21, J23* The analysis reported in this paper grew out of work originally carried out for the OECD. I am grateful to John Evans and Paula Adam of the OECD, for their help in providing some of the data used in the analysis and to John Evans, Simon Parker and an anonymous referee for their helpful comments on previous versions of the paper. Responsibility for the analysis and interpretation of the data, and for the views expressed in the paper, is mine alone.2