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Dynamic Relationships in the Australian Labour Market: Heterogeneity and State Dependence[Note 1. We are thankful to Jeff Borland and two anonymous ...]
Author(s) -
Knights Stephen,
Harris Mark N.,
Loundes Joanne
Publication year - 2002
Publication title -
economic record
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.365
H-Index - 42
eISSN - 1475-4932
pISSN - 0013-0249
DOI - 10.1111/1475-4932.00058
Subject(s) - unobservable , unemployment , economics , context (archaeology) , labour economics , state (computer science) , econometrics , dynamics (music) , demographic economics , macroeconomics , psychology , mathematics , algorithm , biology , paleontology , pedagogy
In this study, individual labour market dynamics are analysed using the Australian Longitudinal Survey. A random utility framework for analysing discrete choices is adopted. In this context, a model incorporating a state dependent relationship between employment outcomes is estimated. The influence on individual employment outcomes of additional variables including education, gender and unemployment benefits is also investigated. It is found that, even after controlling for observable and unobservable differences between individuals, there is evidence of state dependence, which may constitute evidence of a ‘scarring’ effect of unemployment.