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SPECIFICATION TESTS FOR THE COMPETING RISKS DURATION MODEL: AN APPLICATION TO UNEMPLOYMENT DURATION AND SECTORAL MOVEMENT
Author(s) -
Pudney Stephen,
Thomas Jonathan
Publication year - 1995
Publication title -
oxford bulletin of economics and statistics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.131
H-Index - 73
eISSN - 1468-0084
pISSN - 0305-9049
DOI - 10.1111/j.1468-0084.1995.mp57003004.x
Subject(s) - duration (music) , unemployment , econometrics , null hypothesis , economics , specification , statistical hypothesis testing , test (biology) , boundary (topology) , statistics , mathematics , macroeconomics , art , mathematical analysis , biology , paleontology , literature
This study develops three specification tests for the competing risks duration model. They include a general test for misspecification and specific tests for heterogeneity and defective risk distributions. The last two tests involves null hypotheses located on the boundary of the parameter space, and we consider alternative formulations of the score test to take account of this. The tests are applied to models of unemployment duration in which displaced job seekers may become re‐employed in the pre‐unemployment industry or switch industries.