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2018 | OriginalPaper | Buchkapitel

5. Duration Dependence of Job-Finding Rates in Japan

verfasst von : Akiomi Kitagawa, Souichi Ohta, Hiroshi Teruyama

Erschienen in: The Changing Japanese Labor Market

Verlag: Springer Singapore

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Abstract

This chapter examines the negative duration dependence of the job-finding probability in Japan by using officially collected data on individuals from the Labour Force Survey for the period 2003 to 2012. Because the survey has limited information on unemployment duration, a survival analysis is difficult to apply. We try to resolve this problem by adopting the bivariate probit estimation. We use information on the labor market status of the previous year to construct a proxy variable for the long-term unemployment experience. This variable is used to estimate the job-finding rate. A long-term unemployment equation is simultaneously estimated to deal with the problem of unobserved heterogeneity. After controlling for unobserved individual heterogeneity of workers by using a bivariate probit specification, we find that long-term unemployment has a negative impact on the job-finding probability for both men and women. This confirms the fact that the job-finding probability has a negative duration dependence on unemployment in the Japanese labor market. On average, unemployment for a year or more reduces the job-finding probability by about 0.075 (roughly by half).

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Fußnoten
1
See Chap. 3 for a review of the literature.
 
2
This is due to the sample rotation system of this survey. The Statistic Bureau, Ministry of Internal Affairs and Communications, explains the system in the “Sampling Method, Estimation Method, and Sampling Errors of Estimates” as follows. A sample enumeration district remains in a sample for four consecutive months, leaves the sample for the following eight months, and joins the sample again for the same four months in the following year. For each enumeration district, two sets of dwelling units are selected. In the first year of enumeration for the sample enumeration district, the households in the sample dwelling units in the first set are surveyed for the first two consecutive months, and then replaced by households in the dwelling units of the other set. In the second year, the dwelling units of the first set enter the sample again, and are replaced by those of the other set in the same way as in the first year. Under this system, one-fourth of the sample enumeration districts and half of the sample households are replaced every month. Three-fourths of sample enumeration districts are common from month to month and a half of districts from year to year.
 
3
Recall that the data do not have a panel structure as explained in Sect. 5.3.
 
4
Note that an accurate identification is still difficult, as we do not have information on movements between unemployment and the out-of-labor-force states between the second and third survey months. However, this inaccuracy does not seem to cause a serious bias for long-term unemployment identification. Even workers who were unemployed (i.e., were searching jobs) both in the second and third surveys, but stopped searching during the 10 months between the two surveys, are considered to have dominant preference to work and be marginally out of the labor force, namely, “the hidden unemployed.” Thus, we do not think that regarding such persons as unemployed is problematic.
 
5
We do not report the univariate probit estimation results of Eq. (5.2).
 
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Metadaten
Titel
Duration Dependence of Job-Finding Rates in Japan
verfasst von
Akiomi Kitagawa
Souichi Ohta
Hiroshi Teruyama
Copyright-Jahr
2018
Verlag
Springer Singapore
DOI
https://doi.org/10.1007/978-981-10-7158-4_5