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Subsidised Training and Youth Employment: Distinguishing Unobserved Heterogeneity from State Dependence in Labour Market Histories


  • Magnac, Thierry


Using the 1990-2 wave of the French Labour Force Survey to study the employment histories of young people I consider transitions between six labour market states: employment contracts whether permanent or temporary, unemployment, training, education and non-participation. I use a fixed effect estimator in a dynamic multinomial logit model which can accommodate any form of unobserved heterogeneity in levels. This analysis can be extended to Markov processes of any order. I relate heterogeneity components to individual and family characteristics by using simulated maximum likelihood methods. These procedures allow evaluation of the effects training schemes have on youth employment histories.

Suggested Citation

  • Magnac, Thierry, 2000. "Subsidised Training and Youth Employment: Distinguishing Unobserved Heterogeneity from State Dependence in Labour Market Histories," Economic Journal, Royal Economic Society, vol. 110(466), pages 805-837, October.
  • Handle: RePEc:ecj:econjl:v:110:y:2000:i:466:p:805-37

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    References listed on IDEAS

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