Preferences for dismissal protection and the insider/outsider divide

Prominent political economy theories deal with preferences for dismissal regulation. Specifically, various scholars, such as Gilles Saint-Paul or David Rueda, suggest that in dual labour markets two groups oppose each other whose interests are irreconcilable: while insiders (i.e. those with permanent contracts) defend dismissal regulation because it increases their rents, outsiders (temporary workers) see it as a mobility barrier to the primary labour market segment and demand deregulation. Similar divides can be hypothesised for unemployment benefits and redistributional preferences in general: as insiders and outsiders have diverging risks to be affected by unemployment, they should demand different levels of protection and redistribution.

Although these views are influential in the political economy debate, so far there is little empirical research on the effect of contract types on social and labour market policy preferences. Particularly for dismissal protection preferences, there is a lack of suitable data sources and the small number studies analysing it so far have been limited to the use of rather crude proxy variables. We overcome this problem by using a novel data set collected in the most recent presidential contest in France, which combines detailed information on respondents’ employment status with questions measuring attitudes towards dismissal regulation and other labour market policies. Besides the impact of the type of employment contract, we pay particular attention to the explanatory power of respondents' mobility expectations, a frequently overlooked, but conceptually crucial aspect. More precisely, we hypothesise that mobility expectations moderate the effect of employment precariousness on policy preferences.