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Unemployment duration, job search and labour market segmentation. Evidence from urban Ethiopia

  • Pieter Serneels

Although it is a common theoretical assumption that the chances to find a job fall with time in unmeployment, this is not systematically confirmed by empirical evidence, and there is no evidence for developing countries. We develop a farmework that allows us to test the four major explanations why we may observe non-negative duration dependence while genuine duration dependence is negative: financial support for the unemployed, active labour market policies, a change in the economy over time, and segmentation of the labour market into 'good' and 'bad' jobs. Using data for urban Ethiopia we observe a constant hazard while controlling for unobserved heterogeneity, and find that labour market segmentation is the only convincing explanation.

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Paper provided by University of Oxford, Department of Economics in its series Economics Series Working Papers with number CSAE WPS/2008-17.

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Date of creation: 01 Jun 2008
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Handle: RePEc:oxf:wpaper:csae-wps/2008-17
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