Davide Fiaschi (University of Pisa)
Cristina Tealdi
We propose the expected hitting time to permanent employmenti.e., the average time it takes for individuals in any labour market state to attain permanent employmentas a new indicator for assessing the effectiveness of labour market reforms. Since it captures changes in transition probabilities across all economic states, it provides a comprehensive measure of underlying labour market dynamics. Applying this metric to the Italian labour market for the period 20132020, we find that expected hitting times from temporary employment, unemployment, and inactivity fluctuated significantly in response to various policy interventions. Interestingly, we observe substantial differences across worker categories and notable asymmetries in responses to policy interventions based on gender, education, and geographical region.