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Duration dependence, lagged duration dependence, and occurrence dependence in individual employment histories

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  • Niedergesäss, Markus
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    Abstract

    This paper investigates the form and magnitude of a variety of state dependence effects for prime-aged men in Germany. I differentiate between three labor market states: employment, unemployment, and out of labor force. Results indicate that all forms of state dependence are present in the data, in particular, there is strong duration dependence in employment and unemployment. Furthermore, past unemployment experiences are scarring and make future unemployment more likely while past employment experiences help to find new employment, but do not help to remain employed. Simulations are conducted in order to investigate the effects of possible interventions in the labor market. --

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    Bibliographic Info

    Paper provided by University of Tuebingen, Faculty of Economics and Social Sciences in its series University of Tuebingen Working Papers in Economics and Finance with number 26.

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    Date of creation: 2012
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    Handle: RePEc:zbw:tuewef:26

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    Keywords: state dependence; transition data; event history analysis; unobserved heterogeneity;

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    21. Biewen, Martin & Steffes, Susanne, 2010. "Unemployment persistence: Is there evidence for stigma effects?," Economics Letters, Elsevier, vol. 106(3), pages 188-190, March.
    22. Flaig, Gebhard & Licht, Georg & Steiner, Viktor, 1993. "Testing for state dependence effects in a dynamic model of male unemployment behaviour," ZEW Discussion Papers 93-07, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
    23. Anna Christina D'Addio & Michael Rosholm, . "Left-Censoring in Duration Data: Theory and Applications," Economics Working Papers 2002-5, School of Economics and Management, University of Aarhus.
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