A model of labour supply with job offer restrictions

Labour Supply;Models

The joint estimation of a non-linear labour supply function and a wage equation using simulated response probabilities

Wages;Estimation;Labour Supply

Premium Differentiation in the Unemployment Insurance System and the Demand for Labor

In this study we investigate the effect of the introduction of premium differentiation (experience rating) in the Dutch Unemployment Insurance system on the demand for labor. We formulate a model of labor demand, based on the model by Bentolila and Bertola (1990), in which we distinguish two types of workers: the "young" and the "old". This distinction is made, as one of the major motives for opening the discussion around premium differentiation in the Netherlands is the wish to reduce the inflow of older workers into unemployment. In the model, labor adjustment costs (hiring and firing costs) are linear. The model allows for uncertainty in the business cycle. Premium differentiation is incorporated in the model as a rise in firing costs, accompanied by a decrease in unemployment insurance premium payments. Values for the model parameters are determined to quantify the effect of premium differentiation on the demand for labor in various sectors of the Dutch economy. We compute the effect of premium differentiation on the steady state level of labor demand. We also compute the effect of premium differentiation on the level of profits.Unemployment Insurance;premium differentiation;labor demand

The estimation of utility consistent labor supply models by means of simulated scores

Labour Supply

Female Employment and Timing of Births Decisions: A Multiple State Transition Model

In this paper we estimate a multiple state transition model, describing transitions into maternity and labor market transitions for women.Each state is characterized by two components: the labor market state and the maternity state. This enables us to investigate to disentangle the effects of socio-economic variables on the timing of births and on labor market transitions.We find that the transition intensities into maternity are significantly higher for non-employed women than for employed women, and transition intensities into employment are significantly higher for women with no children than for women with children.Lower educated non-employed women have a higher transition probability into maternity and lower transition probability into employment than higher educated non-employed women.female workers;models;pregnancy

Private wealth and job exit at older age: a random effects model

Private wealth holdings are likely to become an increasingly important determinant in the job exit decision of elderly workers. Net wealth may correlate with worker’s characteristics that also determine the exit out of a job. It is therefore important to include a rich set of observed characteristics in an empirical model for retirement in order to measure the (marginal) effect of wealth on the job exit rate. But even with a rich set of regressors the question remains whether there are unobservable worker’s characteristics that affect both net wealth and the job exit rate. We specify a simultaneous equations model for job exit transitions with multiple destinations, net wealth, and the initial labour market state. The job exit rates and the net wealth equation contain random effects. We allow for correlation between the random effects of job exit and net wealth, and the initial labour market state. As instruments for wealth, we use survey information that measures ‘shocks’, like shocks to the household’s financial situation during the previous year. 1 We are greatly indebted to Statistics Netherlands for providing the data

Job search theory, labour supply and unemployment duration

This paper presents a structural model of sequential job search, in which the individual decision makers incorporate labour supply in the job acceptance decision. The model satisfies the reservation wage property. Given the level of the offered wage rate, individuals can choose the number of weekly working hours optimally, by maximizing utility subject to the budget constraint. Specific attention is paid to the stochastic specification. The utility function contains an unobserved random component, and the job offer arrival rate contains unobserved heterogeneity. The search model is used to construct a stationary model of unemployment duration. In estimating the model, simulation methods are used to integrate out unobserved heterogeneity. The goodness of fit of the model is examined by analysis of the residuals