Hostname: page-component-6d856f89d9-mhpxw Total loading time: 0 Render date: 2024-07-16T06:00:39.180Z Has data issue: false hasContentIssue false
  • English
  • Français

Unemployment and Labour Market Transition Probabilities

Published online by Cambridge University Press:  17 August 2016

Jules Theeuwes
Jules Theeuwes*
Affiliation:
Vrije Universiteit Amsterdam(*)
Get access

Extract

I. ANALYSING UNEMPLOYMENT: A RESEARCH PROGRAM

There are many kinds of unemployment. An average economist should be able to enumerate at least a dozen without forward notice. This embarrassing abundance of definitions gives a clear indication of the trouble we have pinning unemployment down.

Unemployment is generally considered to be an undesirable quantity in a market economy. Although not all of it. Part of it is unavoidable and even considered necessary for an efficient matching of jobs and workers. In this sense one could define —although this would not be easy— an optimal quantity of unemployment taking into account the institutions and stochastics of the labour market. Unemployment under and above this optimum would be inefficient. The next question is: can one avoid too much or too little unemployment through policy measures at reasonable costs? There is no definite answer to that. A lot of heated discussion in macroeconomics focusses on this subject.

Type
Research Article
Information
Recherches Économiques de Louvain/ Louvain Economic Review , Volume 52 , Issue 3-4: Symposium on Unemployment in Europe , December 1986 , pp. 209 - 225
Copyright
Copyright © Université catholique de Louvain, Institut de recherches économiques et sociales 1986 

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

Footnotes

*

Thanks are due to W. Kloek for letting me use the aggregate data in section 3. I would also like to thank R. van Opstal for his permission to use the estimation results in section 2. They come out of our 1985 report for the Organisation for Strategic Labour Market Research (OSA) in The Hague. Participants of the Conference on « Unemployment in Europe » in Maastricht, April 1986 and especially Daniel Weiserbs gave very valuable comments on a previous version of this paper. Without implicating them, I would like to thank them all.

References

REFERENCES

Blau, D.M. & Robins, P.K. (1986), Labor Supply Response to Welfare Programs: a Dynamic Analysis, Journal of Labor Economics, vol. 4, n° 1.Google Scholar
Clark, K.B. & Summers, J.H. (1979), Labor Market Dynamics and Unemployment: a Reconsideration, Brookings Papers on Economics Activity, n° 1.Google Scholar
Ehrenberg, R.G. (1980), The Demographic Structure of Unemployment Rates and Labor Market Transition Probabilities, Research in Labor Economics, vol. 3.Google Scholar
Flinn, C.J. & Heckman, J.J. (1982a), Models for the Analysis of Labor Force Dynamics, in Basmann & Rhodes (eds), Advances in Econometrics, 1.Google Scholar
Flinn, C.J. & Heckman, J.J. (1982b), New Methods for Analyzing Structural Models of Labor Force Dynamics, Journal of Econometrics, 18.Google Scholar
Holt, C.C. & David, M.H. (1966), The Concept of Vacancies in a Dynamic Theory of the Labour Market, in Measurement and Interpretation of Job Vacancies, N.B.E.R., New York, p.73–141.Google Scholar
Holt, C.C. (1969), Improving the Labor Market Trade off between Inflation and Unemployment, American Economic Review, 59, 2.Google Scholar
Junankar, P.J. & Price, S. (1984), The Dynamics of Unemployment: Structural Change and Unemployment Flows, Economic Journal, Conference Supplement, p. 158–165.Google Scholar
Kooreman, P. & Ridder, G. (1983), The Effects of Age and Unemployment Percentage on the Duration of Unemployment, European Economic Review, 20.Google Scholar
Lancaster, T. (1979), Econometric Methods for the Duration of Unemployment, Econometrica, 47.Google Scholar
Lancaster, T. & Nickell, S. (1980), The Analysis of Re-Employment Probabilities for the Unemployed, Journal of the Royal Statistical Society A, 143.Google Scholar
Lynch, L.M. (1985), State Dependence in Youth Unemployment: a Lost Generation? Journal of Econometrics, 28.Google Scholar
Martson, S. (1976), Employment Stability and High Unemployment Rates, Brookings Papers on Economic Activity, p. 169–203.Google Scholar
Van Opstal, R. & Theeuwes, J. (1985), Jeugdige werklozen en hun kans op een baan, Organisatie voor Strategisch Arbeidsmarktonderzoek (OSA), working paper n° 14, The Hague.Google Scholar