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Estimating the Probability of Leaving Unemployment Using Uncompleted Spells from Repeated Cross-Section Data

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  • Güell, Maia
  • Hu, Luojia
Abstract
We propose a new econometric estimation method for analysing the probability of leaving un-employment using uncompleted spells from repeated cross-section data, which can be especially useful when panel data are not available. The proposed method-of-moments-based estimator has two important features: (1) it estimates the exit probability at the individual level and (2) it does not rely on the stationarity assumption of the inflow composition. We illustrate and gauge the performance of the proposed estimator using the Spanish Labor Force Survey data, and analyse the changes in distribution of unemployment between the 1980s and 1990s during a period of labour market reform. We find that the relative probability of leaving unemployment of the short-term unemployed versus the long-term unemployed becomes significantly higher in the 1990s.

Suggested Citation

  • Güell, Maia & Hu, Luojia, 2003. "Estimating the Probability of Leaving Unemployment Using Uncompleted Spells from Repeated Cross-Section Data," CEPR Discussion Papers 3957, C.E.P.R. Discussion Papers.
    • Handle: RePEc:cpr:ceprdp:3957
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    More about this item

    Keywords

    Repeated cross-section data; Gmm; Duration analysis; Unemployment;
    All these keywords.

    JEL classification:

    • C41 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Duration Analysis; Optimal Timing Strategies
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search

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