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The Recall and New Job Search of Laid-Off Workers: A Bivariate Proportional Hazard Model with Unobserved Heterogeneity

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  • Bruce Fallick

    (Federal Reserve Board)

  • Keunkwan Ryu

    (School of Economics, Seoul National University)

Abstract

Workers who lose their jobs can become reemployed either by being recalled to their previous employers or by finding new jobs. Workers' chances for recall should depress their job search intensity, so the rates of exit from unemployment by these two routes should be negatively related. We look for evidence in the PSID data by estimating a semiparametric competing risks model with explicitly related hazards. Our estimates reveal a statistically precise but small negative effect of recall probabilities on the rate of new job finding. Copyright by the President and Fellows of Harvard College and the Massachusetts Institute of Technology.

Suggested Citation

  • Bruce Fallick & Keunkwan Ryu, 2007. "The Recall and New Job Search of Laid-Off Workers: A Bivariate Proportional Hazard Model with Unobserved Heterogeneity," The Review of Economics and Statistics, MIT Press, vol. 89(2), pages 313-323, May.
    • Handle: RePEc:tpr:restat:v:89:y:2007:i:2:p:313-323
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    Cited by:

    1. Bruce Fallick & John Haltiwanger & Erika McEntarfer, 2012. "Job-to-job flows and the consequences of job separations," Finance and Economics Discussion Series 2012-73, Board of Governors of the Federal Reserve System (U.S.).
    2. Shigeru Fujita & Giuseppe Moscarini, 2017. "Recall and Unemployment," American Economic Review, American Economic Association, vol. 107(12), pages 3875-3916, December.
    3. Alfonso Alba & Jose Maria Arranz & Fernando Muñoz-Bullón, 2012. "Re-employment probabilities of unemployment benefit recipients," Applied Economics, Taylor & Francis Journals, vol. 44(28), pages 3645-3664, October.
    4. Kim, Dongwoo, 2023. "Partially identifying competing risks models: An application to the war on cancer," Journal of Econometrics, Elsevier, vol. 234(2), pages 536-564.
    5. Fan, Yanqin & Liu, Ruixuan, 2018. "Partial identification and inference in censored quantile regression," Journal of Econometrics, Elsevier, vol. 206(1), pages 1-38.
    6. , 2019. "Job Displacement and Job Mobility: The Role of Joblessness," Working Papers 19-27R, Federal Reserve Bank of Cleveland, revised 31 Aug 2021.
    7. René Böheim, 2006. "“I’ll be Back” – Austrian Recalls," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 33(1), pages 1-18, March.

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