Dynamic Relationships in the Australian Labour Market: Heterogeneity and State Dependence

Stephen Knights, Mark Harris and Joanne Loundes

The Economic Record, 2002, vol. 78, issue 242, 284-298

Abstract: 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.

Date: 2002
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https://doi.org/10.1111/1475-4932.00058

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Working Paper: Dynamic Relationships in the Australian Labour Market: Heterogeneity and State Dependence (2000)
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