Savings and Labor-Market Transitions
- 1 April 1997
- journal article
- research article
- Published by Taylor & Francis in Journal of Business & Economic Statistics
- Vol. 15 (2) , 153-164
- https://doi.org/10.1080/07350015.1997.10524697
Abstract
A model is developed that allows for a layoff rate and a job-arrival rate in the intertemporal choice of consumption and labor-market state. The identification of such a model is established without recourse to dynamic programming solutions, and the minimum data requirements for estimation are derived. Unobserved heterogeneity is included in the model specification, but state dependence is only allowed through the layoff and arrival rates. These are restricted to be functions of observable weakly exogenous variables.Keywords
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