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How Long Is a Spell of Unemployment? Illusions and Biases in the Use of CPS Data

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  • Kiefer, Nicholas M
  • Lundberg, Shelly J
  • Neumann, George R

Abstract

Most data used to study the durations of unemployment spells come from the Current Population Survey, which is a point-in-time survey and gives an incomplete picture of the underlying duration distribution. We introduce a new sample of completed unemployment spells obtained from panel data and apply CPS sampling and reporting techniques to replicate the type of data used by other researchers. Predicted duration distributions derived from this CPS-like data are then compared to the actual distribution. We conclude that the best inferences that can be made about unemployment durations using CPS-like data are seriously biased.

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Bibliographic Info

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

Volume (Year): 3 (1985)
Issue (Month): 2 (April)
Pages: 118-28

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Handle: RePEc:bes:jnlbes:v:3:y:1985:i:2:p:118-28

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  1. 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.).
  2. Stephen T. Marston, 1976. "Employment Instability and High Unemployment Rates," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 7(1), pages 169-210.
  3. Stephen W. Salant, 1974. "Search theory and duration data: a theory of sorts," Special Studies Papers 42, Board of Governors of the Federal Reserve System (U.S.).
  4. 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.
  5. Keeley, Michael C, et al, 1978. "The Estimation of Labor Supply Models Using Experimental Data," American Economic Review, American Economic Association, vol. 68(5), pages 873-87, December.
  6. Bowers, J K & Harkess, D, 1979. "Duration of Unemployment by Age and Sex," Economica, London School of Economics and Political Science, vol. 46(183), pages 239-60, August.
  7. Robert E. Hall, 1972. "Turnover in the Labor Force," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 3(3), pages 709-764.
  8. Burdett, Kenneth, et al, 1984. "Earnings, Unemployment, and the Allocation of Time over Time," Review of Economic Studies, Wiley Blackwell, vol. 51(4), pages 559-78, October.
  9. Tuma, Nancy Brandon & Robins, Philip K, 1980. "A Dynamic Model of Employment Behavior: An Application to the Seattle and Denver Income Maintenance Experiments," Econometrica, Econometric Society, vol. 48(4), pages 1031-52, May.
  10. Frank, Robert H, 1978. "How Long Is a Spell of Unemployment?," Econometrica, Econometric Society, vol. 46(2), pages 285-302, March.
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Citations

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Cited by:
  1. Bowles, Roger Arthur & Florackis, Chrisostomos, 2007. "Duration of the time to reconviction: Evidence from UK prisoner discharge data," Journal of Criminal Justice, Elsevier, vol. 35(4), pages 365-378.
  2. Sanford M. Jacoby & Sunil Sharma, 1991. "Employment Duration and Industrial Labor Mobility in the United States, 1880-1980," UCLA Economics Working Papers 618, UCLA Department of Economics.
  3. Francisco J. Gil & Maria Jesus Martin & Angel Serrat, 1994. "Movilidad en el mercado de trabajo en España: un análisis econométrico de duración con riesgos en competencia," Investigaciones Economicas, Fundación SEPI, vol. 18(3), pages 517-537, September.
  4. Ignez M. Tristao, 2007. "Occupational Employment Risk and its Consequences for Unemployment Duration and Wages: Working Paper 2007-01," Working Papers 18287, Congressional Budget Office.
  5. Haroon Bhorat & David Tseng, 2012. "The Newly Unemployed and the UIF Take-up Rate in the South African Labour Market," Working Papers 12147, University of Cape Town, Development Policy Research Unit.
  6. Yang, Zhenlin & Tsui, Albert K., 2004. "Analytically calibrated Box-Cox percentile limits for duration and event-time models," Insurance: Mathematics and Economics, Elsevier, vol. 35(3), pages 649-677, December.

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