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Is longer unemployment rewarded with longer job tenure?

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Author Info

  • Miki Kohara

    (Osaka School of International Public Policy, Osaka University)

  • Masaru Sasaki

    (Institute of Social and Economic Research, Osaka University)

  • Tomohiro Machikita

    (Institute of Developing Economies, Inter-disciplinary Studies Center, Japan External Trade)

Abstract

This paper examines whether or not a prolonged unemployment period can raise the quality of job matching after unemployment. We focus on job tenure as an indicator of a good quality job match after unemployment. We match two sets of Japanese administrative data compiled by the public employment security offices: one includes information about the circumstances of job seekers receiving unemployment insurance, and the other includes information about job seekers applying for jobs. We first show a negative relationship between unemployment duration and the subsequent job duration. Restricting the sample to job seekers who lower their reservation wage in the final 59 days before expiration of unemployment insurance, we secondly show an even greater negative effect of unemployment duration on the following job duration. The importance lies not only in the duration of unemployment. If job seekers keep a high reservation wage because of the benefits of unemployment insurance, and lower it in response to the expiration of insurance, prolonged unemployment will result in short job duration after unemployment.

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Bibliographic Info

Paper provided by Osaka School of International Public Policy, Osaka University in its series OSIPP Discussion Paper with number 11E001.

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Length: 30 pages
Date of creation: Feb 2011
Date of revision:
Handle: RePEc:osp:wpaper:11e001

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Keywords: job search; quality of job match; unemployment duration; unemployment insurance;

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References

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As found by EconAcademics.org, the blog aggregator for Economics research:
  1. Waiting for the perfect job does not work
    by Economic Logician in Economic Logic on 2011-04-04 14:03:00
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Cited by:
  1. Miki Kohara & Masaru Sasaki & Tomohiro Machikita, 2011. "Is longer unemployment rewarded with longer job tenure?," OSIPP Discussion Paper 11E001, Osaka School of International Public Policy, Osaka University.

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