This paper contributes new evidence from two large household surveys on the compliance of firms with severance pay regulations in Indonesia, and the extent to which changes in severance pay regulations could affect employment rigidity. Compliance appears to be low, as only one-third of workers...

Reform of the labor market in the former Soviet Union (FSU) is essential to increase productivity. The transition of the FSU economies to a market economy must involve a massive displacement of workers, and will entail labor shortages for certain skills. A key challenge will be to reallocate...