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CEP discussion paper

The Hidden Costs of Fixed Term Contracts: the Impact On Work Accidents


This paper assesses whether there is a systematic difference between the accident rates of fixed term and permanent contract workers that is not just the result of a compositional effect. A pure contractual effect might exist because the short duration of the temporary contract reduces the incentives to invest in specific human capital leading to a higher accident rate. I provide two identification strategies to control for selection and reporting biases. The results confirm there is a pure contractual effect that increases the accident probability by 4 percent to 7 percent.


Marķa Guadalupe

October 2002     Paper Number CEPDP0551

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