Unemployment and Labour Mobility in Estonia: Analysis Using Duration Models

Marit Hinnosaar ()

No 2002-07, Bank of Estonia Working Papers from Bank of Estonia

Abstract: The current paper analyses unemployment and labour movements between labour market statuses in the period of January 1997 to July 2000 using data from the Estonian Labour Force Surveys. The paper is motivated by the hypothesis that in the beginning of transition in Estonia high labour mobility and low unemployment rate seemed to be related. The analysis reveals that in the end of the 1990s labour mobility has decreased substantially in Estonia compared to 1994. The results from the paper indicate that unemployment rate and labour mobility measure have inverse relationship, both in aggregate and disaggregate level. The most mobile groups in Estonian labour market are Estonians, people living in the area of capital Tallinn and people with higher education. Young people also tend to move a lot from job to job. High mobility in case of young workers is accompanied by high number of unemployment incidents, which is captured by the aggregate unemployment rate time series.

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Date: 2002-10-13, Revised 2002-10-13
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