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Type: IFS Working Papers Authors: Richard Blundell, Thierry Magnac and Costas Meghir ISSN: 1742-0415
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 which are restricted to be functions of observable weakly exogenous variables.
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Recent IFS Working Papers
Identifying the drivers of month of birth differences in educational attainment
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The impact of age within academic year on adult outcomes
We provide the first evidence on whether differences in childhood outcomes translate into differences in the probability of employment, occupation and earnings for adults in the UK.
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