@techreport{8f2eed3f18e84d5ea290ac99d4a8e1e0,
title = "Labour costs and the decision to hire the first employee",
abstract = "Firms without paid employees account for up to 80% of all firms, but only a small minority ever hires. This paper investigates the relationship between labour costs and the decision to hire a first employee and become an employer. Leveraging a unique policy in Belgium that permanently reduced the labour cost of the first employee by 13%, we find that the number of new, first-time employers jumped by 31% immediately following the reform. The elasticity of the probability to hire the first employee with respect to the labour cost is −2.39 [95% CI: −3.45, −1.25].",
keywords = "nonemployers, hiring decisions, payroll taxes, small businesses",
author = "B. Cockx and Sam Desiere",
year = "2023",
month = jun,
day = "8",
doi = "10.26481/umagsb.2023007",
language = "English",
series = "GSBE Research Memoranda",
publisher = "Maastricht University, Graduate School of Business and Economics",
number = "007",
address = "Netherlands",
type = "WorkingPaper",
institution = "Maastricht University, Graduate School of Business and Economics",
}