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Transition to full-time employment status based on two-equation and three-equation probit model with endogenous switching


  • Natalia Nehrebecka

    () (Faculty of Economic Sciences, University of Warsaw; Department of Statistics, National Bank of Poland)


This paper examines employment transitions among men and women in Poland aged between 20 and 65 based on the data from the CHER (Consortium of Household Panels for European Socio-Economic Research). The research results show that the state of the person in a given year is not only dependent upon his/her state in the previous year, but also upon whether he/she was in that state the years before. Moreover, the study proves that the impact of individual characteristics of persons on the conditional probability of retaining a given status depends on the persons’ employment record, which confirms the rejection of the null hypothesis regarding the „interdependence of states”. As a result of this study, we can determine that, as expected, being in a given state, just like entry in to that state, are conditioned by demographic characteristics and the human capital of the respondent, as well as by the characteristics of the household, although the impact of these variables depends on the occupational background of that person. This implies that every individual may get trapped in non-employment and, ideally, policy should intervene as soon as the individual begins non-employment period. This article also includes statistics describing the duration of each status and time spent outside of the status by persons with different combinations of characteristics calculated based on the parameter estimation of the model.

Suggested Citation

  • Natalia Nehrebecka, 2010. "Transition to full-time employment status based on two-equation and three-equation probit model with endogenous switching," Working Papers 2010-11, Faculty of Economic Sciences, University of Warsaw.
  • Handle: RePEc:war:wpaper:2010-11

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    More about this item


    two-equation and three-equation probit model with endogenous switching; initial conditions problem; labour market; transitions;

    JEL classification:

    • J48 - Labor and Demographic Economics - - Particular Labor Markets - - - Particular Labor Markets; Public Policy
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search
    • C25 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions; Probabilities

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