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Business Cycles and Compositional Variation in U.S. Unemployment

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  • Abbring, Jaap H
  • van den Berg, Gerard J
  • van Ours, Jan C

Abstract

In this article, we study U.S. unemployment dynamics using grouped unemployment data from the Current Population Survey over the period 1968-92. We estimate a model that traces variation in these unemployment data, both over time and between demographic groups, back to the underlying variation in the inflow and the outflow. In turn, we model the outflow as a transition process in which we allow the exit probabilities to depend on calendar time, duration, and demographic group. We use the estimation results to provide a decomposition of aggregate U.S. unemployment dynamics in various incidence and duration components.

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Bibliographic Info

Article provided by American Statistical Association in its journal Journal of Business and Economic Statistics.

Volume (Year): 19 (2001)
Issue (Month): 4 (October)
Pages: 436-48

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Handle: RePEc:bes:jnlbes:v:19:y:2001:i:4:p:436-48

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  1. Sider, Hal, 1985. "Unemployment Duration and Incidence: 1968-82," American Economic Review, American Economic Association, vol. 75(3), pages 461-72, June.
  2. Carlson, John A & Horrigan, Michael W, 1983. "Measures of Unemployment Duration as Guides to Research and Policy: Comment [An Experience-Weighted Measure of Employment and Unemployment Duration]," American Economic Review, American Economic Association, vol. 73(5), pages 1143-50, December.
  3. Olivier Jean Blanchard & Peter Diamond, 1990. "Ranking, Unemployment Duration, and Wages," NBER Working Papers 3387, National Bureau of Economic Research, Inc.
  4. Baker, Michael, 1992. "Digit preference in CPS unemployment data," Economics Letters, Elsevier, vol. 39(1), pages 117-121, May.
  5. Darby, Michael R & Haltiwanger, John C & Plant, Mark W, 1985. "Unemployment Rate Dynamics and Persistent Unemployment under Rational Expectations," American Economic Review, American Economic Association, vol. 75(4), pages 614-37, September.
  6. Baker, Michael, 1992. "Unemployment Duration: Compositional Effects and Cyclical Variability," American Economic Review, American Economic Association, vol. 82(1), pages 313-21, March.
  7. George A. Akerlof & Brian G. M. Main, 1978. "Unemployment spells and unemployment experience," Special Studies Papers 123, Board of Governors of the Federal Reserve System (U.S.).
  8. Berg, G. van den & Ours, J.C. van, 1996. "Unemployment dynamics and duration dependence," Open Access publications from Tilburg University urn:nbn:nl:ui:12-86874, Tilburg University.
  9. van den Berg, Gerard J & van Ours, Jan C, 1996. "Unemployment Dynamics and Duration Dependence," Journal of Labor Economics, University of Chicago Press, vol. 14(1), pages 100-125, January.
  10. Olivier Jean Blanchard, 1991. "Wage Bargaining and Unemployment Persistence," NBER Working Papers 3664, National Bureau of Economic Research, Inc.
  11. Abowd, John M & Zellner, Arnold, 1985. "Estimating Gross Labor-Force Flows," Journal of Business & Economic Statistics, American Statistical Association, vol. 3(3), pages 254-83, June.
  12. Kim B. Clark & Lawrence H. Summers, 1979. "Labor Market Dynamics and Unemployemnt: A Reconsideration," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 10(1), pages 13-72.
  13. Butler, Richard J & McDonald, James B, 1986. "Trends in Unemployment Duration Data," The Review of Economics and Statistics, MIT Press, vol. 68(4), pages 545-57, November.
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