State dependence, duration dependence and unobserved heterogeneity in the employment transitions of the over-50s
This paper examines employment transitions among men and women in the UK aged between 50 and the state pension age. We begin by examining the issue of duration dependence, using standard duration models. We then use a fourth order Markov model to estimate quarterly transitions while allowing for potential endogeneity of initial conditions. The results reject exogeneity of initial conditions and show the importance of both duration dependence and state dependence. This implies there is the potential for any individual to become trapped in non-employment and, ideally, policy should intervene as soon as an individual begins a period of non-employment.
|Date of creation:||18 Jul 2007|
|Date of revision:|
|Contact details of provider:|| Postal: |
Web page: https://www.iser.essex.ac.uk/
More information through EDIRC
|Order Information:|| Postal: Publications Office, Institute for Social and Economic Research, University of Essex, Wivenhoe Park, Colchester, Essex CO4 3SQ UK|
Web: https://www.iser.essex.ac.uk/publications/ Email:
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Van den Berg, Gerard J., 2001.
"Duration models: specification, identification and multiple durations,"
Handbook of Econometrics,
in: J.J. Heckman & E.E. Leamer (ed.), Handbook of Econometrics, edition 1, volume 5, chapter 55, pages 3381-3460
- Van den Berg, Gerard J., 2000. "Duration Models: Specification, Identification, and Multiple Durations," MPRA Paper 9446, University Library of Munich, Germany.
- David Haardt, 2007.
"Transitions Out Of and Back To Employment among Older Men and Women in the UK,"
Social and Economic Dimensions of an Aging Population Research Papers
197, McMaster University.
- Disney, Richard & Emmerson, Carl & Wakefield, Matthew, 2006.
"Ill health and retirement in Britain: A panel data-based analysis,"
Journal of Health Economics,
Elsevier, vol. 25(4), pages 621-649, July.
- Richard Disney & Carl Emmerson & Matthew Wakefield, 2003. "Ill health and retirement in Britain: a panel data based analysis," IFS Working Papers W03/02, Institute for Fiscal Studies.
- Han, Aaron & Hausman, Jerry A, 1990. "Flexible Parametric Estimation of Duration and Competing Risk Models," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 5(1), pages 1-28, January-M.
- Meghir, Costas & Whitehouse, Edward, 1997.
"Labour market transitions and retirement of men in the UK,"
Journal of Econometrics,
Elsevier, vol. 79(2), pages 327-354, August.
- Costas Meghir & Whitehouse, E, 1995. "Labour market transitions and retirement of men in the UK," IFS Working Papers W95/10, Institute for Fiscal Studies.
- Costas Meghir & Edward Whitehouse, 1993. "Labour market transitions and retirement of men in the UK," IFS Working Papers W93/12, Institute for Fiscal Studies.
- Arulampalam, Wiji & Booth, Alison L & Taylor, Mark P, 2000. "Unemployment Persistence," Oxford Economic Papers, Oxford University Press, vol. 52(1), pages 24-50, January.
- Jeffrey M Wooldridge, 2002.
"Simple solutions to the initial conditions problem in dynamic, nonlinear panel data models with unobserved heterogeneity,"
CeMMAP working papers
CWP18/02, Centre for Microdata Methods and Practice, Institute for Fiscal Studies.
- Jeffrey M. Wooldridge, 2005. "Simple solutions to the initial conditions problem in dynamic, nonlinear panel data models with unobserved heterogeneity," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 20(1), pages 39-54.
- Richard Blundell & Costas Meghir & Sarah Smith, 2002. "Pension Incentives and the Pattern of Early Retirement," Economic Journal, Royal Economic Society, vol. 112(478), pages C153-C170, March.
- Jenkins, Stephen P, 1995. "Easy Estimation Methods for Discrete-Time Duration Models," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 57(1), pages 129-38, February.
- Heckman, James & Singer, Burton, 1984. "A Method for Minimizing the Impact of Distributional Assumptions in Econometric Models for Duration Data," Econometrica, Econometric Society, vol. 52(2), pages 271-320, March.
- Sueyoshi, Glenn T., 1992. "Semiparametric proportional hazards estimation of competing risks models with time-varying covariates," Journal of Econometrics, Elsevier, vol. 51(1-2), pages 25-58.
When requesting a correction, please mention this item's handle: RePEc:ese:iserwp:2007-16. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Paul Groves)The email address of this maintainer does not seem to be valid anymore. Please ask Paul Groves to update the entry or send us the correct address
If references are entirely missing, you can add them using this form.