Samaniego (2006) emphasises the role played by industry composition. In a vintage-capital model firms optimally reduce their workforce as they fall behind the technological frontier. As a consequence, firing restrictions are more costly in industries characterised by rapid technological change such as ICT. Countries where regulations are more stringent will therefore tend to specialise in industries where the rate of technical change is sluggish. Poschke (2009) emphasises the role of firing costs in the selection of the most efficient firms and the exit decision of low-productivity firms.