An opportunity cost approach to redundancy compensation: An application to Sri Lanka

  • Ariel Fiszbein

Abstract

The paper proposes the principles which should guide the design of a compensation package for redundant workers following a program of voluntary retrenchment. It is argued that the compensation should be equal to the opportunity cost of leaving the enterprise. Using a simple specification for the opportunity cost, a payment schedule is derived and simulated for the case of Sri Lanka.
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How to Cite
Fiszbein, A. (2016). An opportunity cost approach to redundancy compensation: An application to Sri Lanka. Estudios de Economía, 21(3), pp. 113-126. Retrieved from https://estudiosdeeconomia.uchile.cl/index.php/EDE/article/view/40934/43777
Section
Articles
Published
2016-05-09