The Anatomy of Unemployment Dynamics

Tinbergen Institute Working Paper No. 94-95 (revised)

43 Pages Posted: 1 Aug 1999

See all articles by Jaap H. Abbring

Jaap H. Abbring

Tilburg University - Department of Econometrics & Operations Research; Tilburg University - Center for Economic Research (CentER); Tinbergen Institute; IZA Institute of Labor Economics

Gerard J. van den Berg

VU University Amsterdam - Department of Economics; Centre for Economic Policy Research (CEPR); IZA Institute of Labor Economics; Tinbergen Institute

Jan C. van Ours

Tilburg University - Department of Economics; University of Melbourne - Department of Economics

Date Written: May 7, 1999

Abstract

This paper examines the relation between individual unemployment durations and incidence on the one hand, and the time-varying macroeconomic conditions in the economy on the other. We allow for contemporaneous calendar time effects acting on the exit probabilities for all currently unemployed. Also, we allow for cohort effects on the exit probabilities by allowing the composition of the inflow into unemployment to depend on calendar time. In both cases we distinguish between business cycle effects and seasonal effects. The model is estimated with aggregate unemployment duration data, in which we allow for unobserved heterogeneity and correlated measurement errors. The results enable us to give a complete decomposition of the dynamics of unemployment over calendar time.

JEL Classification: C41, E32, J64

Suggested Citation

Abbring, Jaap H. and van den Berg, Gerard J. and van Ours, Jan C., The Anatomy of Unemployment Dynamics (May 7, 1999). Tinbergen Institute Working Paper No. 94-95 (revised). Available at SSRN: https://ssrn.com/abstract=167308 or http://dx.doi.org/10.2139/ssrn.167308

Jaap H. Abbring (Contact Author)

Tilburg University - Department of Econometrics & Operations Research ( email )

Tilburg, 5000 LE
Netherlands

HOME PAGE: http://center.uvt.nl/staff/abbring/

Tilburg University - Center for Economic Research (CentER) ( email )

P.O. Box 90153
Tilburg, 5000 LE
Netherlands

HOME PAGE: http://center.uvt.nl/staff/abbring/

Tinbergen Institute

Roetersstraat 31
Amsterdam, 1018WB
Netherlands

HOME PAGE: http://www.tinbergen.nl

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Gerard J. Van den Berg

VU University Amsterdam - Department of Economics ( email )

De Boelelaan 1105
1081 HV Amsterdam
Netherlands
+31 20 444 6132 (Phone)
+32 20 444 6020 (Fax)

Centre for Economic Policy Research (CEPR)

London
United Kingdom

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Tinbergen Institute

Burg. Oudlaan 50
Rotterdam, 3062 PA
Netherlands

Jan C. Van Ours

Tilburg University - Department of Economics ( email )

P.O. Box 90153
Tilburg, 5000 LE
Netherlands
+31 13 466 2880 (Phone)
+31 13 466 3042 (Fax)

University of Melbourne - Department of Economics ( email )

Melbourne, 3010
Australia

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