Inflow composition, duration dependence and their impact on the unemployment outflow rate
- 2003
- p.31-47.
- Feb
This paper presents estimates of the components of the dynamics of the unemployment outflow rate with British data. We allow both the composition of the inflow and individual duration dependence to vary over the business cycle. We find the inflow composition to be strongly counter cyclical. Individual exit rates are found to be substantially more sensitive to the business cycle than previously thought and than the average exit rate fluctuations suggest. Cyclical variations in duration dependence are not significant. With out estimates, fluctuations in the average exit rate out of the first year of unemployment are mainly accounted for by variations of individual exit rates, variation of inflow composition, and variation in the inflow level combined with the duration dependence phenomenon. - Reproduced.