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Title: Empirical Tests of Job Search Theory Using the Duration of Unemployment
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1. Coppock, David Steven
Empirical Tests of Job Search Theory Using the Duration of Unemployment
Ph.D. Dissertation, Yale University, 1980. DAI-A 41/12, p. 5195, June 1981
Cohort(s): Older Men
Publisher: UMI - University Microfilms, Bell and Howell Information and Learning
Keyword(s): Business Cycles; Current Population Survey (CPS) / CPS-Fertility Supplement; Heterogeneity; Job Search; Unemployment

This dissertation uses data on the duration of unemployment to test theories of job search. Two questions are emphasized. First, whether the probability that an unemployed individual accepts a job offer increases or stays constant over the spell of unemployment, as is predicted by job search models. Second, whether periods of high unemployment are characterized by a paucity of job offers or by misperceptions on the part of job searchers about the wage offer distribution. Estimating how the probability of accepting a job offer changes over the spell of unemployment (duration dependence) is difficult because negative duration dependence (i.e., a declining probability of accepting a job offer) has many of the same implications for the data as does heterogeneity in the acceptance probability across individuals. It is shown, in fact, that some past attempts to overcome this problem rely on arbitrary functional form assumptions which cannot be justified. However, it is shown that some inferences about heterogeneity and duration dependence can be made when data are available on more than one spell of unemployment for some individuals. These methods are implemented using data from the National Longitudinal Survey of Mature Men. The results are consistent with job search theory. Under various hypotheses about the nature of business cycles, a simple model of job search is used to make predictions about how the coefficients of an unemployment duration equation should change over the business cycle. Cyclical estimates are obtained using a sample of adult men from the Current Population Survey. The results support the hypothesis that recessions are characterized by a paucity of job offers.
Bibliography Citation
Coppock, David Steven. Empirical Tests of Job Search Theory Using the Duration of Unemployment. Ph.D. Dissertation, Yale University, 1980. DAI-A 41/12, p. 5195, June 1981.