The Inter-related Dynamics of Unemployment and Low-Wage Employment

Mark Stewart

The Warwick Economics Research Paper Series (TWERPS) from University of Warwick, Department of Economics

Abstract: This paper examines the extent of state dependence in unemployment and the role played in this by intervening low-wage employment. A range of dynamic random and fixed effects estimators are compared. Low-wage employment is found to have almost as large an adverse effect as unemployment on future prospects and the difference in their effects is found to be insignificant. Evidence is presented that low-wage jobs act as the main conduit for repeat unemployment and considerably increases its probability. Obtaining a higher-wage job reduces the increased risk of repeat unemployment to insignificance.

Keywords: Unemployment dynamics; low-wage employment; State dependence; unobserved heterogeneity; dynamic random effects models; repeat unemployment (search for similar items in EconPapers)
JEL-codes: C23 C25 J31 J64 (search for similar items in EconPapers)
Pages: 31 pages
Date: 2006
New Economics Papers: this item is included in nep-lab
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Citations: View citations in EconPapers (22)

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Related works:
Journal Article: The interrelated dynamics of unemployment and low-wage employment (2007)
Working Paper: The Inter-related Dynamics of Unemployment and Low-wage Employment (2005)
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Persistent link: https://EconPapers.repec.org/RePEc:wrk:warwec:741

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