THE DETERMINANTS OF EMPLOYMENT PROBATION LENGTHS

Casual observations suggest that employment probation is widely used b y employers but virtually no attention has been paid to the topic in t he industrial relations or labor economics literature. This paper exam ines the reasons for the incidence of probation use in the labor marke t and the dispersion of observed probation lengths. The findings broad en our knowledge of this employment feature and are relevant to topics such as wage growth, employee screening, turnover, and optimal contra cts because they reveal whether theoretical models often used to study these issues are well-founded.