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The Duration of Youth Unemployment in West Germany: Some Theoretical Considerations


  • Wolfgang Franz


This paper presents a theoretical model dealing with the duration of youth unemployment in West Germany. Duration can be expressed in terms of the underlying hazard function. After a brief discussion of a reasonable shape of the hazard function a distinction is made with respect to the probabilities of receiving a job offer and accepting it. Determinants of the latter decision are developed using a unified model of consumption, leisure, and job search. Uncertainty and some restrictions such as standard work time and entitlement to unemployment compensation are taken into account. The probability of receiving a job offer depends, among other factors, on the screening process undertaken by the firms .

Suggested Citation

  • Wolfgang Franz, 1979. "The Duration of Youth Unemployment in West Germany: Some Theoretical Considerations," NBER Working Papers 0397, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:0397
    Note: LS

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    References listed on IDEAS

    1. Amemiya, Takeshi, 1973. "Regression Analysis when the Dependent Variable is Truncated Normal," Econometrica, Econometric Society, vol. 41(6), pages 997-1016, November.
    2. Richard B. Freeman, 1979. "Why is There A Youth Labor Market Problem?," NBER Working Papers 0365, National Bureau of Economic Research, Inc.
    3. Borjas, George J & Goldberg, Matthew S, 1978. "Biased Screening and Discrimination in the Labor Market," American Economic Review, American Economic Association, vol. 68(5), pages 918-922, December.
    4. Akerlof, George A & Main, Brian G M, 1980. "Unemployment Spells and Unemployment Experience," American Economic Review, American Economic Association, vol. 70(5), pages 885-893, December.
    5. Stephen W. Salant, 1977. "Search Theory and Duration Data: A Theory of Sorts," The Quarterly Journal of Economics, Oxford University Press, vol. 91(1), pages 39-57.
    6. Seater, John J., 1977. "A unified model of consumption, labor supply, and job search," Journal of Economic Theory, Elsevier, vol. 14(2), pages 349-372, April.
    7. Herbert Grubel & Dennis Maki, 1976. "The effects of unemployment benefits on U. S. Unemployment rates," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 112(2), pages 274-299, June.
    8. Seater, John J, 1979. "Job Search and Vacancy Contacts," American Economic Review, American Economic Association, vol. 69(3), pages 411-419, June.
    9. Lancaster, Tony, 1979. "Econometric Methods for the Duration of Unemployment," Econometrica, Econometric Society, vol. 47(4), pages 939-956, July.
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    Cited by:

    1. Wolfgang Franz, 1980. "The Reservation Wage of Unemployed Persons in the Federal Republic of Germany: Theory and Empirical Tests," NBER Working Papers 0578, National Bureau of Economic Research, Inc.

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