Individuals' Unemployment Durations over the Business Cycle

Using a large panel of administrative records this study confirms the predictions of the ranking model of Blanchard and Diamond (1994) that an individual?s probability of leaving unemployment decreases with unemployment duration and increases with economic growth. However, the ranking model of Blanchard and Diamond (1994) makes the further prediction that negative genuine duration dependence will be stronger the more depressed the labour market. In conflict with this prediction this study provides persuasive empirical evidence that the pattern of negative genuine duration dependence does not change over the business cycle. Moreover it is shown that the finding in previous studies that negative genuine duration dependence becomes stronger the more depressed the labour market arises from failure to control for cyclical fluctuations in the composition of the newly unemployed. This finding carries a strong warning for policy assessment: unless controlled for cyclical fluctuations in the composition of the newly unemployed an evaluation of a policy designed to get the longterm unemployed into work will be biased towards a success in times of high economic growth and towards a failure in times of low economic growth

Individuals' Unemployment Experiences: Heterogeneity and Business Cycle Effects

This study examines individuals? unemployment experiences from the age of 18 up to the age of 35 using a large panel of administrative records on unemployment related benefit claims of men in the United Kingdom over the past two decades. The main focus is on the extent to which individuals? unemployment experiences are affected by regional and skill differences, i.e. individual heterogeneity, and the business cycle. In particular this study analyses the extent to which repeated unemployment is experienced by individuals who are not able to get stable employment and individuals who hold several jobs interrupted with spells of unemployment before obtaining stable employment. The results provide new insights into the long-term benefits of a labour market program aimed at increasing the employability of the unemployed and getting them into work, such as the New Deal in the UK

Permanent and Transitory Wage Inequality of British Men, 1975-2001: Year, Age and Cohort Effects

We examine the variance-covariance structure of log-wages over time and over the lifecycle of British men from 1975 to 2001, hereby controlling for cohort effects. Wage inequality has risen sharply during the 1980?s and early 1990?s and remained fairly constant in the second half of the 1990?s. We show that this increase is caused mainly by a strong increase in the transitory wage inequality and only to a lesser extent to an increase in the permanent wage inequality. The transitory component of wages is, however, highly persistent over time: serial correlation decreases from 0.88 over a one-year period to 0.65 over a ten-year period. The constant wage inequality in the second half of the 1990?s is attributed to a slight decrease in permanent wages inequality, a stabilization of the variance of the transitory wage shock, and the strong decrease in the transitory wage inequality for the cohorts entering employment since the end of the 1980?s. Ignoring age effects in transitory wage inequality and cohort effects, as is commonly done, leads to severely distorted inferences concerning the changes in permanent wage inequality

Television Role Models and Fertility Evidence from a Natural Experiment

In this paper we study the effect of television exposure on fertility. We exploit a natural experiment that took place in Germany after WWII. For topographical reasons, Western TV programs, which promoted one/no child families, could not be received in certain parts of East Germany. Using an IV approach, we find robust evidence that watching West German TV results in lower fertility. This conclusion is robust to alternative model specifications and data sets. Our results imply that individual fertility decisions are affected by role models or information about other ways of life promoted by media

The effects of female employment status on the presence and number of children

The main concern of this paper is to analyze the effects of female employment status on the presence and number of children in households in the Netherlands. For this purpose a hurdle count data model is formulated and estimated by the generalized method of moments. The hurdle takes explicitly into account the interrelationship between female employment status and timing of first birth. The number of children, once children are present in the household, is modeled conditional on female employment status. The empirical results show that female employment status is a major determinant of the presence and number of children in households: employed women schedule children later in life and have fewer children compared to nonemployed women, holding educational attainment constant. After controlling for female employment status, the educational attainment of both the woman and the man in the households are found to have relatively small effects on the presence and number of children.Hurdle count data model, fertility, female employment