In particular, a large literature documents the existence of a deep divide, within the formal sector, between jobs offering permanent contracts and those offering fixed-term contracts. The distinction is especially relevant from a job quality perspective since fixed-term jobs tend to be, on average, second best jobs characterised by lower earnings quality, higher labour market risk (due to both higher risk of joblessness and to lower unemployment benefit coverage) and lower quality of the working environment (OECD, 2014, Chapter 3). Furthermore, these forms of fixed-term employment are quite widespread in emerging economies, notably in Latin American countries and China.