A model is developed that allows for a layoff rate and a job arrival rate in the intertemporel choice of consumption and labor market state. The identification of such a model is established without recourse to dynamic programming solutions and the minimum data requirements for estimation are derived. Unobserved heterogeneity is included in the model specification but state dependence is only allowed through the layoff and arrival rates which are restricted to be functions of observable weakly exogenous variables.
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Paper provided by Institut National de la Statistique et des Etudes Economiques- in its series Papers with number
9622.
Length: 40 pages Date of creation: 1996 Date of revision: Handle: RePEc:fth:inseep:9622
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Find related papers by JEL classification: J20 - Labor and Demographic Economics - - Demand and Supply of Labor - - - General J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure J29 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Other
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