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Cyclical variations in unemployment duration

Author

Listed:
  • Michael Rosholm

    (Department of Economics, Aarhus School of Business Fuglesangs Allé 20, DK-8210 Aarhus V, and Centre for Labour Market and Social Research)

Abstract

In this paper I study how individual unemployment durations vary over the business cycle, using unemployment spells of a sample of Danish workers. A compositional, an outflow, and a residual calendar-time component are identified, and they all contribute to explaining the variations in unemployment duration. Based on the analysis it is concluded that long-term unemployment is a phenomenon that is associated with periods of high unemployment, but nothing should prevent the long-term unemployed finding jobs again as aggregate unemployment eventually starts falling. In particular, there is no evidence of negative duration dependence, not even at long durations, and not when aggregate unemployment is high.

Suggested Citation

  • Michael Rosholm, 2001. "Cyclical variations in unemployment duration," Journal of Population Economics, Springer;European Society for Population Economics, vol. 14(1), pages 173-191.
    • Handle: RePEc:spr:jopoec:v:14:y:2001:i:1:p:173-191
    Note: Received: 7 December 1998/Accepted: 24 August 1999
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    Citations

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    Cited by:

    1. International Monetary Fund, 2008. "Denmark: Selected Issues," IMF Staff Country Reports 2008/380, International Monetary Fund.
    2. Muriel Dejemeppe & Yves Saks, 2002. "A New Light into Regional Unemployment Disparities in Belgium : Longitudinal Analysis of Grouped Duration Data," LIDAM Discussion Papers IRES 2002019, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
    3. Lars Pico Geerdsen & Stéphanie Vincent Lyk-Jensen & Cecilie Dohlmann Weatherall, 2018. "Accelerating the transition to employment at benefit exhaustion: still possible after four years of unemployment?," Empirical Economics, Springer, vol. 54(3), pages 1107-1135, May.
    4. Sabine Klinger & Thomas Rothe, 2012. "The Impact of Labour Market Reforms and Economic Performance on the Matching of the Short‐term and the Long‐term Unemployed," Scottish Journal of Political Economy, Scottish Economic Society, vol. 59(1), pages 90-114, February.
    5. Muriel Dejemeppe, 2005. "A Complete Decomposition of Unemployment Dynamics using Longitudinal Grouped Duration Data," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 67(1), pages 47-70, February.
    6. Bart Cockx & Muriel Dejemeppe, 2005. "Duration dependence in the exit rate out of unemployment in Belgium. Is it true or spurious?," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 20(1), pages 1-23, January.
    7. Jouko Verho, 2005. "Unemployment Duration and Business Cycles in Finland," Working Papers 214, Työn ja talouden tutkimus LABORE, The Labour Institute for Economic Research LABORE.
    8. NAGORE GARCIA Amparo & VAN SOEST Arthur, 2016. "Unemployment Exits Before and During the Crisis," LISER Working Paper Series 2016-14, Luxembourg Institute of Socio-Economic Research (LISER).
    9. Deborah A. Cobb-Clark & Andrew Leigh, 2009. "Long-Term Unemployment in the ACT," CEPR Discussion Papers 603, Centre for Economic Policy Research, Research School of Economics, Australian National University.
    10. Agne Lauzadyte, 2007. "A Statistical Programme Assignment Model," Economics Working Papers 2007-18, Department of Economics and Business Economics, Aarhus University.
    11. Ivana Malá & Adam Èabla, 2022. "Modelling of the Unemployment Duration in the Czech Republic Based on Aggregated Complete and Individual Censored Data," Journal of Economics / Ekonomicky casopis, Institute of Economic Research, Slovak Academy of Sciences, vol. 70(2), pages 171-187, January.
    12. Adriaan Kalwij, 2010. "Unemployment durations and the pattern of duration dependence over the business cycle of British males," Empirical Economics, Springer, vol. 38(2), pages 429-456, April.
    13. Michal Franta, 2008. "Time Aggregation Bias in Discrete Time Models of Aggregate Duration Data," Working Papers 2008/10, Czech National Bank.
    14. Amparo Nagore García & Arthur Soest, 2017. "Unemployment Exits Before and During the Crisis," LABOUR, CEIS, vol. 31(4), pages 337-368, December.
    15. Jouko Verho, 2014. "Unemployment duration and the role of compositional variation: evidence from a period of economic crisis in Finland," Empirical Economics, Springer, vol. 47(1), pages 35-56, August.

    More about this item

    Keywords

    Unemployment duration · business cycle fluctuation;

    JEL classification:

    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search

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