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Explaining Non-Negative Duration Dependence Among the Unemployed

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  • Pieter Serneels

Abstract

We investigate why we observe non-negative duration dependence among young unemployed men in urban Ethiopia. Assuming that genuine duration dependence is negative, there are five explanations for a non-decreasing hazard: the presence of unemployment benefits, the existence of Active Labour Market Policies, the change in labour demand, segmentation of the labour market, and unemployment as a queuing phenomenon. We test each of these explanations and find that labour market segmentation is the only convincing one. We also establish that genuine duration dependence is indeed negative in the long run.

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Paper provided by Centre for the Study of African Economies, University of Oxford in its series CSAE Working Paper Series with number 2002-13.

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Date of creation: 2002
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Handle: RePEc:csa:wpaper:2002-13

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Keywords: unemployment; duration; segmented labour markets; urban labour market;

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Cited by:
  1. Pieter Serneels, 2004. "The Nature of Unemployment in Urban Ethiopia," Development and Comp Systems 0409042, EconWPA.
  2. D. O'Neill & Sweetman. O. & Van de gaer D., 2005. "The Consequences of Non-Classical Measurement Error for Distributional Analysis," Economics, Finance and Accounting Department Working Paper Series n1490205, Department of Economics, Finance and Accounting, National University of Ireland - Maynooth.
  3. Donal O'Neill & Olive sweetman, 2012. "The Consequences of Measurement Error when Estimating the Impact of BMI on Labour Market Outcomes," Economics, Finance and Accounting Department Working Paper Series n232b-12.pdf, Department of Economics, Finance and Accounting, National University of Ireland - Maynooth.

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