Labour mobility of unemployed workers

In this study the mover-stayer models of transition intensities and labour mobility are examined using Finnish microeconomic data on unemployment durations. Duration models are used to analyse the probabilities of transition. The probabilities of becoming employed, moving to another region and changing occupations are estimated using censored data on unemployment durations. The models are based on a Gompertz distribution, which yields estimates of the proportion of unemployed persons who become employed, move or change occupations. Allowance for neglected heterogeneity is made assuming that the effect of omitted variables has a gamma distribution across persons. (C) 2002 Elsevier Science B V All rights reserved.