A Behavioral Economic Analysis of Dispatched Workers

Author Name OHTAKE Fumio  (Institute of Social and Economic Research, Osaka University) /LEE Sun Youn  (Ph.D. candidate, Osaka School of International Public Policy, Osaka University)
Creation Date/NO. April 2011 11-J-054
Research Project Reform of Labor Market Institutions
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Under traditional economics analysis, relaxing the regulations on dispatch work has been considered to enhance labor market efficiency. A temporary agency, which helps facilitate the matching of firms and on-the-job searchers, is thought to play a role in reducing both the period of unemployment and duration of the job search, thereby improving the welfare of both employers and employees. Accordingly, temporary work has been expected to function as a "stepping stone" towards stable full-time employment.

In this study, we analyzed dispatched workers with particular attention to their individual time discounting rates. We found that some dispatched workers remained in a non-regular status over an extended period of time, while others moved into permanent positions. In addition, those who continue to work as a dispatched worker over an extended period of time tend to have time discounting rates that are high and/or high levels of procrastination. These behavioral tendencies of dispatched workers suggest the importance of identifying workers who easily accept unstable non-permanent jobs despite their preference for permanent positions, and providing support to them until they obtain stable full-time jobs.