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The Duration-Based Measurement of Unemployment: Estimation Issues and an Application to Male-Female Unemployment Differences in France

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  • Stephen Bazen

    ()
    (AMSE - Aix-Marseille School of Economics - Aix-Marseille Univ. - Centre national de la recherche scientifique (CNRS) - Ecole des Hautes Etudes en Sciences Sociales (EHESS) - Ecole Centrale Marseille (ECM))

  • Xavier Joutard

    ()
    (AMSE - Aix-Marseille School of Economics - Aix-Marseille Univ. - Centre national de la recherche scientifique (CNRS) - Ecole des Hautes Etudes en Sciences Sociales (EHESS) - Ecole Centrale Marseille (ECM))

  • Mouhamadou M. Niang

    ()
    (AMSE - Aix-Marseille School of Economics - Aix-Marseille Univ. - Centre national de la recherche scientifique (CNRS) - Ecole des Hautes Etudes en Sciences Sociales (EHESS) - Ecole Centrale Marseille (ECM))

Abstract

This paper examines how unemployment can be measured in normative fashion - taking into account the mean and inequality of spell lengths - and how the extent of unemployment can be estimated from cross section data of the type found in labour force surveys. The issue is not straightforward since in these surveys completed durations of unemployed individuals are not observed yet they constitute the basis for calculating the kind of index that has been proposed to measure the extent of unemployment in a way that goes beyond the unemployment rate. The index proposed by Shorrocks has robust normative foundations and has an equivalent representation in terms of average complete duration and the density of completed durations. Building upon earlier work applied in the United States for estimating the first of these, we present a method that enables the index to be calculated based on an estimate of the density of completed durations. The approach is illustrated in the context of comparing male-female unemployment differences in France, where historically female unemployment has been higher than that of males.

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Paper provided by HAL in its series Working Papers with number halshs-00793056.

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Date of creation: Mar 2012
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Handle: RePEc:hal:wpaper:halshs-00793056

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Keywords: unemployment measurement; completed duration; synthetic cohort; gender gap;

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  1. Güell, Maia & Hu, Luojia, 2003. "Estimating the Probability of Leaving Unemployment Using Uncompleted Spells from Repeated Cross-Section Data," CEPR Discussion Papers, C.E.P.R. Discussion Papers 3957, C.E.P.R. Discussion Papers.
  2. Sen, Amartya K, 1976. "Poverty: An Ordinal Approach to Measurement," Econometrica, Econometric Society, Econometric Society, vol. 44(2), pages 219-31, March.
  3. Paul, Satya, 1991. "On the measurement of unemployment," Journal of Development Economics, Elsevier, Elsevier, vol. 36(2), pages 395-404, October.
  4. Disney, Richard, 1979. "Recurrent Spells and the Concentration of Unemployment in Great Britain," Economic Journal, Royal Economic Society, Royal Economic Society, vol. 89(353), pages 109-19, March.
  5. Ghazala Azmat & Maia Güell & Alan Manning, 2003. "Gender Gaps in Unemployment Rates in OECD Countries," Working Papers 137, Barcelona Graduate School of Economics.
  6. Baker, Michael, 1992. "Unemployment Duration: Compositional Effects and Cyclical Variability," American Economic Review, American Economic Association, American Economic Association, vol. 82(1), pages 313-21, March.
  7. Vani K . Borooah, 2002. "A Duration‐sensitive Measure of the Unemployment Rate: Theory and Application," LABOUR, CEIS, CEIS, vol. 16(3), pages 453-468, 09.
  8. Foster, James & Greer, Joel & Thorbecke, Erik, 1984. "A Class of Decomposable Poverty Measures," Econometrica, Econometric Society, Econometric Society, vol. 52(3), pages 761-66, May.
  9. George A. Akerlof & Brian G. M. Main, 1978. "Unemployment spells and unemployment experience," Special Studies Papers, Board of Governors of the Federal Reserve System (U.S.) 123, Board of Governors of the Federal Reserve System (U.S.).
  10. Vani K. Borooah, 2002. "A Duration-Sensitive Measure of the Unemployment Rate: Theory and Application," ICER Working Papers, ICER - International Centre for Economic Research 19-2002, ICER - International Centre for Economic Research.
  11. Martin Riese & K. Brunner, 1998. "Measuring the severity of unemployment," Journal of Economics, Springer, Springer, vol. 67(2), pages 167-180, June.
  12. Stephen W. Salant, 1974. "Search theory and duration data: a theory of sorts," Special Studies Papers, Board of Governors of the Federal Reserve System (U.S.) 42, Board of Governors of the Federal Reserve System (U.S.).
  13. Saul, S., 1992. "An Illfare Approach to the Measurement of Unemployment," Papers, Western Sydney - School of Business And Technology e9204, Western Sydney - School of Business And Technology.
  14. Baker, G M & Trivedi, P K, 1985. "Estimation of Unemployment Duration from Grouped Data: A Comparative Study," Journal of Labor Economics, University of Chicago Press, University of Chicago Press, vol. 3(2), pages 153-74, April.
  15. Atkinson, Anthony B., 1970. "On the measurement of inequality," Journal of Economic Theory, Elsevier, Elsevier, vol. 2(3), pages 244-263, September.
  16. Nickell, Stephen J, 1979. "Estimating the Probability of Leaving Unemployment," Econometrica, Econometric Society, Econometric Society, vol. 47(5), pages 1249-66, September.
  17. Bishop, John A & Chow, K Victor & Zheng, Buhong, 1995. "Statistical Inference and Decomposable Poverty Measures," Bulletin of Economic Research, Wiley Blackwell, Wiley Blackwell, vol. 47(4), pages 329-40, October.
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