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The Duration of New Job Matches in East and West Germany

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  • Wolff, Joachim

Abstract

This study compares the duration of new job matches in the east and west German labour market that formed between the start of the German Economic, Monetary and Social Union in July 1990 and December 2000. The study relies on job duration data drawn from the German Socio-economic Panel. It shows with non-parametric duration methods that job matches are less stable in east than in west Germany. However, this is not the case in the first years of the transition process, in which most likely the more profitable jobs were created and the best job matches were formed. Results form the non-parametric analysis but also from a proportional hazards model that controls for important covariates imply that the transition rates into alternative jobs and into unemployment vary with tenure in a way, which is in line with predictions of theories of job mobility such as the job specific capital hypothesis and matching theories.

Suggested Citation

  • Wolff, Joachim, 2004. "The Duration of New Job Matches in East and West Germany," Discussion Papers in Economics 360, University of Munich, Department of Economics.
  • Handle: RePEc:lmu:muenec:360
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    File URL: https://epub.ub.uni-muenchen.de/360/1/wolffdp2004_10.pdf
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    References listed on IDEAS

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    1. Meyer, Bruce D, 1990. "Unemployment Insurance and Unemployment Spells," Econometrica, Econometric Society, vol. 58(4), pages 757-782, July.
    2. Stepan Jurajda & Katherine Terrell, 2001. "What Drives the Speed of Job Reallocation during Episodes of Massive Adjustment?," CERGE-EI Working Papers wp170, The Center for Economic Research and Graduate Education - Economics Institute, Prague.
    3. Stephen P. Jenkins, 1998. "Discrete time proportional hazards regression," Stata Technical Bulletin, StataCorp LP, vol. 7(39).
    4. Kraus, Florian & Puhani, Patrick A. & Steiner, Viktor, 1998. "Do public works programs work? Some unpleasant results from the East German experience," ZEW Discussion Papers 98-07, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
    5. Jovanovic, Boyan, 1979. "Job Matching and the Theory of Turnover," Journal of Political Economy, University of Chicago Press, vol. 87(5), pages 972-990, October.
    6. Farber, Henry S., 1999. "Mobility and stability: The dynamics of job change in labor markets," Handbook of Labor Economics,in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 37, pages 2439-2483 Elsevier.
    7. Jovanovic, Boyan, 1979. "Firm-specific Capital and Turnover," Journal of Political Economy, University of Chicago Press, vol. 87(6), pages 1246-1260, December.
    8. Corporate author, 2002. "Die Lage der Weltwirtschaft und der deutschen Wirtschaft im Herbst 2002," DIW Wochenbericht, DIW Berlin, German Institute for Economic Research, vol. 69(43), pages 703-757.
    9. Arbeitsgemeinschaft deutscher wirtschaftswissenschaftlicher Forschungsinstitute, 2002. "Die Lage der Weltwirtschaft und der deutschen Wirtschaft im Herbst 2002," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 55(20), pages 3-50, October.
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    Citations

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    Cited by:

    1. Boockmann, Bernhard & Hagen, Tobias, 2008. "Fixed-term contracts as sorting mechanisms: Evidence from job durations in West Germany," Labour Economics, Elsevier, vol. 15(5), pages 984-1005, October.
    2. Boris Hirsch & Thorsten Schank & Claus Schnabel, 2010. "Differences in Labor Supply to Monopsonistic Firms and the Gender Pay Gap: An Empirical Analysis Using Linked Employer-Employee Data from Germany," Journal of Labor Economics, University of Chicago Press, vol. 28(2), pages 291-330, April.
    3. Erlinghagen, Marcel, 2006. "Erstarrung, Beschleunigung oder Polarisierung? Arbeitsmarktmobilität und Beschäftigungsstabilität im Zeitverlauf. Neue Ergebnisse mit der IAB-Beschäftigtenstichprobe," Graue Reihe des Instituts Arbeit und Technik 2006-01, Institut Arbeit und Technik (IAT), Westfälische Hochschule, University of Applied Sciences.
    4. Boockmann, Bernhard & Steffes, Susanne, 2005. "Individual and Plant-level Determinants of Job Durations in Germany," ZEW Discussion Papers 05-89, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
    5. repec:bla:obuest:v:79:y:2017:i:2:p:276-289 is not listed on IDEAS
    6. Michael Pries & Richard Rogerson, 2005. "Hiring Policies, Labor Market Institutions, and Labor Market Flows," Journal of Political Economy, University of Chicago Press, vol. 113(4), pages 811-839, August.
    7. Boris Hirsch & Thorsten Schank & Claus Schnabel, 2008. "Differences in Labor Supply to Monopsonistic Firms and the Gender Pay Gap: An Empirical Analysis Using Linked Employer-Employee Data from Germany," Working Papers 1111, Princeton University, Department of Economics, Industrial Relations Section..

    More about this item

    Keywords

    Job duration; job changes; hazard rate; theories of job mobility; economies in transition;

    JEL classification:

    • C41 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Duration Analysis; Optimal Timing Strategies
    • J63 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Turnover; Vacancies; Layoffs
    • P52 - Economic Systems - - Comparative Economic Systems - - - Comparative Studies of Particular Economies

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