The Determinants of Hiring Older Workers: Evidence from Hong Kong

Abstract

A 1996 survey of Hong Kong establishments designed to identify hiring and employment patterns by workers' age shows that, as in the United States, many firms employed older workers but did not hire older workers. This pattern appears to reflect mainly economic forces, rather than public policy, given that no laws prohibited age discrimination or required uniform fringe benefit provision in Hong Kong. The empirical evidence from the survey is consistent with two broad hypotheses. First, workers and firms are more willing to invest in training when workers are young. Second, delayed compensation more effectively deters shirking among young workers than among older workers and is more readily accepted by young workers.