Employment Effects of the Italian Jobs Act: An Ex‐Post Impact Evaluation

ABSTRACT In 2015, Italy adopted a new labor market policy known as the Jobs Act (JA), aimed at promoting employment and reducing the costs associated with firing employees. We investigate how the impact of the JA provisions on employment. We estimate the effect of the relief on social security contributions and and assess the impact of the new firing rules on employment through a two‐step procedure: propensity score matching and difference‐in‐differences estimation. The results of our model do not indicate a significant impact of these measures, either on employment levels or on changes among flexible workers.