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Duration Dependence in the Exit Rate out of Unemployment in Belgium: Is It True or Spurious?

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  • Cockx, Bart

    ()
    (Ghent University)

  • Dejemeppe, Muriel

    ()
    (Université catholique de Louvain)

Abstract

On the basis of aggregate data for the early nineties, we analyse the determinants of unemployment duration for laid-off male workers in Wallonia (Belgium). Our results demonstrate that if ranking in recruitment occurs, the standard Mixed Proportional Hazard specification can be too restrictive, leading to an overstatement of the extent of true negative duration dependence. We conclude that negative duration dependence is largely spurious. We also decompose the time variation of the hazard in (unobserved) compositional and direct cyclical and seasonal effects. We find counter-cyclical variation in the quality of young workers, but none for the prime aged.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 632.

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Length: 31 pages
Date of creation: Nov 2002
Date of revision:
Publication status: published in: Journal of Applied Econometrics, 2005, 20 (1), 1-23
Handle: RePEc:iza:izadps:dp632

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Keywords: unemployment duration; ranking; heterogeneity; business cycle;

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References

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Citations

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Cited by:
  1. Cockx, Bart, 1999. "The Design of Active Labour Market Policies. What Matters and What Doesn't ?," Discussion Papers (IRES - Institut de Recherches Economiques et Sociales), Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES) 1999035, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
  2. Maes, Marjan, 2008. "poverty persistence among belgian elderly: true or spurious?," Working Papers, Hogeschool-Universiteit Brussel, Faculteit Economie en Management 2008/10, Hogeschool-Universiteit Brussel, Faculteit Economie en Management.
  3. Pieter Serneels, 2008. "Unemployment duration, job search and labour market segmentation.� Evidence from urban Ethiopia," Economics Series Working Papers, University of Oxford, Department of Economics CSAE WPS/2008-17, University of Oxford, Department of Economics.
  4. Bruno, VAN DER LINDEN, 2005. "Equilibrium Evaluation of Active Labor Market Programmes Enhancing Matching Effectiveness," Discussion Papers (ECON - Département des Sciences Economiques), Université catholique de Louvain, Département des Sciences Economiques 2005007, Université catholique de Louvain, Département des Sciences Economiques.
  5. Melanie Arntz & Ralf Wilke, 2009. "Unemployment Duration in Germany: Individual and Regional Determinants of Local Job Finding, Migration and Subsidized Employment," Regional Studies, Taylor & Francis Journals, Taylor & Francis Journals, vol. 43(1), pages 43-61.
  6. Adriaan Kalwij, 2010. "Unemployment durations and the pattern of duration dependence over the business cycle of British males," Empirical Economics, Springer, Springer, vol. 38(2), pages 429-456, April.
  7. Bart Cockx & Matteo Picchio, 2012. "Are Short-lived Jobs Stepping Stones to Long-Lasting Jobs?," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, Department of Economics, University of Oxford, vol. 74(5), pages 646-675, October.
  8. Marjan, MAES, 2008. "Poverty persistence among Belgian elderly in the transition from work to retirement : an empirical analysis," Discussion Papers (ECON - Département des Sciences Economiques), Université catholique de Louvain, Département des Sciences Economiques 2008042, Université catholique de Louvain, Département des Sciences Economiques.
  9. Gabriele, CARDULLO & Bruno, VANDERLINDEN, 2006. "Employment subsidies and substitutable skills : An equilibrium matching approach," Discussion Papers (ECON - Département des Sciences Economiques), Université catholique de Louvain, Département des Sciences Economiques 2006010, Université catholique de Louvain, Département des Sciences Economiques.
  10. Ana Luísa Abras & Fabiana de Felício, 2005. "Duração E Taxa De Saída Do Desemprego: Evidências De Ausência De Dependência Na Duração Para As Regiões Metropolitanas Do Brasil (1984-2000)," Anais do XXXIII Encontro Nacional de Economia [Proceedings of the 33th Brazilian Economics Meeting], ANPEC - Associação Nacional dos Centros de Pósgraduação em Economia [Brazilian Association of 169, ANPEC - Associação Nacional dos Centros de Pósgraduação em Economia [Brazilian Association of Graduate Programs in Economics].
  11. Benjamín Villena Roldán, 2010. "Aggregate Implications of Employer Search and Recruiting Selection," Documentos de Trabajo, Centro de Economía Aplicada, Universidad de Chile 271, Centro de Economía Aplicada, Universidad de Chile.
  12. Michal Franta, 2008. "Time Aggregation Bias in Discrete Time Models of Aggregate Duration Data," Working Papers, Czech National Bank, Research Department 2008/10, Czech National Bank, Research Department.
  13. Niedergesäss, Markus, 2013. "Employment, partnership and childbearing decisions of German women and men: A simultaneous hazards approach," University of Tuebingen Working Papers in Economics and Finance, University of Tuebingen, Faculty of Economics and Social Sciences 51, University of Tuebingen, Faculty of Economics and Social Sciences.

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