Separability of Duration Dependence and Unobserved Heterogeneity
AbstractMixed proportional hazard models are commonly used to estimate duration dependence and unobserved heterogeneity in unemployment exit rates. Some strong assumptions are made in this framework, i.e. that the various influences on the individual unemployment exit rate are separable. The model we use in this paper allows for both the individual duration dependence pattern and the inflow composition to exhibit cyclical variations, thereby relaxing two of the three separability assumptions. The aim of this paper is to assess the validity of the third separability assumption, namely that the duration dependence pattern is the same for all individuals.
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Bibliographic InfoPaper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 754.
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Date of creation: Apr 2003
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Find related papers by JEL classification:
- J64 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - Unemployment: Models, Duration, Incidence, and Job Search
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