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An extra time duration model with application to unemployment duration under benefits in Spain

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Abstract

This paper postulates that the effect of unemployment benefits on the hazard rates changes considerably using a traditional duration model that uses only unemployment insurance (UI) data, or deals with unemployment assistance (UA) as a mere extension of UI, instead of an extra time duration model that accounts separately for transition rates to work of the unemployed who receive UI and UA. For UI recipients the hazard rate rises dramatically when UI benefits lapse approaches. On the contrary, for UA recipients the hazard rate remains flat or even has a slight fall nearby the UA lapse. Finally, there is a group of unemployed qualified for UA that quit UI due to the income fall that they will experience when they pass from UI to UA.

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File URL: http://public.centrodeestudiosandaluces.es/pdfs/E200338.pdf
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Bibliographic Info

Paper provided by Centro de Estudios Andaluces in its series Economic Working Papers at Centro de Estudios Andaluces with number E2003/38.

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Length: 41 pages
Date of creation: 2003
Date of revision:
Handle: RePEc:cea:doctra:e2003_38

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Keywords: unemployment benefits mixed proportional hazard model; unobserved heterogeneity;

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Cited by:
  1. Labeaga, José M. & Molina, José Alberto & Navarro, María, 2011. "Deprivation using satisfaction measures in Spain: An evaluation of unemployment benefits," Journal of Policy Modeling, Elsevier, vol. 33(2), pages 287-310, March.
  2. Darja Borsic & Alenka Kavkler, 2009. "Duration of Regional Unemployment Spells in Slovenia," Managing Global Transitions, University of Primorska, Faculty of Management Koper, vol. 7(2), pages 123-146.

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