benefit entitlement and unemployment duration the role of policy endogeneity abstract the potential duration of benefits is generally viewed as an important determinant of unemployment duration this paper evaluates a unique policy change that prolonged entitlement to regular unemployment benefits from 30 weeks to a maximum of 209 weeks for elderly individuals in certain regions of austria in the evaluation we explicitly account for the fact that the program was an endogenous policy response to deteriorating labor market conditions for older workers in certain regions and sectors the main results are i rebp reduced the transition rate to jobs by 17 ii accounting for endogenous policy adoption is important and quantitatively significant

the swedish unemployment experience abstract since the 1960s sweden has sustained a remarkably low unemployment rate while the average duration of unemployment spells has been increasing over time this pattern is reproduced in an equilibrium search model incorporating progressive income taxes generous unemployment compensation and a program for preventing unemployed workers from abusing the system our analysis raises concerns about how well the swedish system is equipped to handle the current situation of high unemployment

renewable energy expansion in the chilean power market a dynamic general equilibrium modeling approach to determine co2 emission baselines abstract over the last decade a high dependency on carbon intensive fuels in the chilean power sector has led to environmental concerns particularly regarding rapid growth in co2 emissions more recently the power sector has experienced significant structural changes with a rapid expansion of renewables in the energy matrix and this trend is expected to cause significant variations in future co2 emission baseline scenarios to investigate the economy wide impact of renewable energy expansions in chile s energy mix this research based on a computable general equilibrium cge model examines different co2 emission baseline scenarios however because traditional cge modeling approaches cannot capture the impact of a sector s recent structural changes we present a step by step approach to incorporate different energy matrices from an external engineering bottom up model into the cge model the results indicate that the business as usual bau scenario in which structural changes are not considered significantly overstates expected emissions conversely considering structural changes in our cge model shows chile advancing towards its declared nationally determined contribution ndc to reduce greenhouse gas emissions furthermore the methodology implemented in the study has the advantage of being a simple integrated approach that is coherent with current modeling capacities in many developing contexts

the aggregate labour market an empirical investigation into market clearing for the uk a two equation model of the aggregate labor market is presented as part of a larger market clearing macroeconomic framework which is then estimated by a suitable subsystem estimator using annual data for the u k 1948 1979 taken on their own theory consistent estimates of both labor supply and labor demand are obtained the maintained hypothesis that the market clears cannot be tested againsta more general structural model within the framework presented however a test of the model against the data generation process suggests that the maintained hypothesis is untenable after 1966 which is confirmed by evidence of dynamic instability copyright 1987 by royal economic society

nonstationarity in job search theory generally structural job search models are taken to be stationary in this paper models are examined in which every exogenous variable can cause nonstationarity for instance because its value is dependent on unemployment duration a general differential equation that describes the evolution of the reservation wage over time is derived as an empirical illustration a nonstationary structural model is estimated that focuses on the consequences of a downward shift in the level of benefits it appears that the elasticity of duration with respect to the level of benefits after the shift is much larger than the elasticity with respect to the level before the shift this paper examines the movement of a job seeking individual s reservation wage over time in a general nonstationary job search model also results concerning comparative dynamics of the reservation wage and the distribution of the duration of unemployment are derived as an empirical illustration a nonstationary structural model is estimated the nonstationarity originates from the decrease in the level of benefits when unemployment duration equals two years from the results some detailed policy recommendations can be deduced as one is able to distinguish the effect of a change in the level of benefits in the first two years of unemployment from the effect of a change in the level after that period recently the use of job search models for the analysis of unemployment duration has become widespread the reduced form approach in empirical studies see e g lancaster 1979 in which only the hazard of the duration distribution is estimated is gradually being replaced by a more structural approach the latter way of modelling is characterized by the explicit use in empirical analysis of the reservation wage equation as stated by the theory e g yoon 1981 lancaster and chesher 1983 lynch 1983 narendranathan and nickell 1985 and van den berg 1988 use the complete theoretical framework of job search theory to make inferences about search behaviour however the structural models used in these studies are stationary this implies that variables like unemployment benefits or the rate of arrival of job offers are assumed to be constant over the spell of unemployment which is often at variance with reality what is more various reduced form empirical studies indicate a significant durationdependence of the re employment probability which is generally interpreted as evidence in favour of the presence of nonstationarity see e g blau and robins 1986 kooreman and ridder 1983 lancaster 1979 and narendranathan nickell and stern 1985 consequently there is a need to model reservation wage movements over time based on a nonstationary theoretical framework

duration and risk of unemployment in argentina abstract after a decade of structural reforms unemployment rates have tripled in argentina this paper is concerned with the measurement of unemployment risk and its distribution we show the importance of considering re incidence in the measurement of unemployment risk and develop a methodology to do that our estimates for argentina show that though the typical unemployment spell is short once re incidence is taken into account unemployment risk is high has risen substantially in the last decade and is shared very unequally in the labor force this counters the established view that unemployment is a small risk short duration phenomenon which arises when re incidence is not considered

co movements of oecd growth cycles the study is of short run and long run co movements and convergence across 21 oecd real per capita outputs on a sample period spanning 1960 to 1992 using dynamic principal components analysis and coherence analysis we reject the hypothesis of convergence but find evidence for long run growth cycles closely related across countries in particular the g5 group exhibits the highest degree of economic integration in the long run the group of the original members of the community also exhibits linkages at high and medium frequencies and represents the most homogeneous area in europe in terms of output dynamics both in the long and short run

reservation wages and the cost of unemployment this paper studies direct evidence on reservation wages reported in great britain in 1982 to assess 1 whether such asking prices are high and 2 whether variations in these reservation wages are related to differences in measures of the subjective and objective costs of unemployment a majority overall and for various subgroups reports reservation wages no higher than own past wages adjusted for earnings growth but there is nonetheless considerable dispersion in the ratio of reservation to past wages reservation wages are somewhat related to measures of the differential cost of unemployment most clearly for men although the independent role of benefits is often imprecisely measured however exactly which of these costs matter differs significantly according to whether the separation from last employment was voluntary or involuntary copyright 1989 by the london school of economics and political science

unemployment dynamics and duration dependence in france the netherlands and the united kingdom this paper analyzes unemployment dynamics in the french dutch and u k labor market it presents a method to distinguish between the effects of duration dependence and unobserved heterogeneity on the exit rate out of unemployment it turns out that for british male unemployed there is strong genuine negative duration dependence for french unemployed there is no strong duration dependence during the first year of unemployment while for dutch unemployed there is nonmonotonic duration dependence for all groups of french and dutch individuals significant unobserved heterogeneity is found for u k male unemployed heterogeneity seems to be empirically unimportant copyright 1994 by royal economic society

development of method for estimation of world industrial energy consumption and its application abstract the energy balances published by the international energy agency iea are one of the most valuable sources of energy statistics covering world energy supply and demand however some issues arise when these data are analyzed or used directly even when industrial energy consumption alone is examined at least three types of issues are encountered missing data large amounts of misallocated data in some countries and numerous unrealistic outliers in the time series variations when we deal with only a few regions we can look at data one by one and modify them in this case we are going to overcome these issues with a systematic method because the data covers world including more than a hundred regions this paper proposes a data reconciliation method to treat these issues and describes its application to world industrial energy consumption as a result of its application we found that the three issues mentioned above seemed to be overcome the degree of the reconciliation by region showed that oecd countries degree tends to be smaller than those of non oecd countries however not all of the oecd countries have low values and some countries such as the united states have high values

friedman s plucking model of business fluctuations tests and estimates of permanent and transitory components in milton friedman s model output cannot exceed a ceiling level but occasionally is plucked downward by recession implying fluctuations are asymmetric recessions transitory and recessions duration dependent though expansions are not the empirical literature lends support but formal modeling has been absent the econometric model presented here encompasses both plucking and symmetric fluctuations around a stochastic trend we find gdp is well characterized by the plucking model implied recessions correspond to nber reference cycles and no role for symmetric cycles decomposition of the unemployment rate reveals a corresponding asymmetry and timing paths of ceiling output and trend unemployment are presented

can training and employment subsidies combat european unemployment active policy evaluation problems methods and results european countries with poorly performing labour markets and labour market institutions conducive to high unemployment also feature considerable expenditures on active labour market policy and such policies are emphasized by the european union s employment strategy however the practice of these programmes evaluation is much less well developed in europe than in the united states we outline key issues facing such evaluation and offer a review and formal assessment of european evaluation studies over the last three decades we find that programme effects are very heterogeneous across types of interventions and target groups that training and job search assistance can be effective and that the young among the unemployed are typically difficult to assist jochen kluve and christoph m schmidt

introducing detailed land based mitigation measures into a computable general equilibrium model abstract we propose a new climate change mitigation assessment method focusing on agriculture forestry and land use change sectors by coupling the computable general equilibrium cge model with a bottom up type technology model the cge model covers the entire economic market but includes a rough description of mitigation measures whereas the bottom up type technology model takes into account abatement cost and mitigation effects of individual mitigation measures but only focuses on a few sectors the coupled framework enables us to connect relevant conditions and to complement the shortcomings of each model as a test we applied our method to indonesia which has set a national greenhouse gas emissions reduction target for 2020 a large proportion of indonesia s greenhouse gas emissions are from the land use sector we assessed the differences in modeling behaviors between the cge models with and without coupling the bottom up type model the two primary findings were 1 consumption loss estimated by the coupled cge 1 2 was larger than the loss estimated by the uncoupled model 0 5 because the emission reduction estimated by the bottom up model was less than the standalone cge s estimate and 2 consumption loss caused by achieving the reduction target by 2020 in indonesia strongly depends on the assumption of mitigation costs and available land area for the emission reduction measures

how do different entitlements to unemployment benefits affect the transitions from unemployment into employment abstract in portugal duration of benefits is exclusively age determined while replacement rates are essentially uniform we exploit differences in potential maximum duration of benefits for nearly matched pairs of individuals to determine the effects of benefit duration on job finding

market externalities of large unemployment insurance extension programs we provide evidence that unemployment insurance affects equilibrium conditions in the labor market which creates significant market externalities we provide a framework for identification of such equilibrium effects and implement it using the regional extension benefit program rebp in austria which extended the duration of ui benefits for a large group of eligible workers in selected regions of austria we show that non eligible workers in rebp regions have higher job finding rates lower unemployment durations and a lower risk of long term unemployment we discuss the implications of our results for optimal ui policy jel e24 j64 j65 r23

the impact of the potential duration of unemployment benefits on the duration of unemployment abstract this paper examines the impact of the potential duration of unemployment insurance ui benefits on unemployment in the united states first we use a large sample of household heads to examine differences in the unemployment spell distributions of ui recipients and nonrecipients sharp increases in the escape rate from unemployment both through recalls and new job acceptances are apparent for ui recipients around the time of benefits exhaustion such increases are not apparent at similar points of spell duration for nonrecipients second our analysis of accurate administrative data from 12 states indicates that a one week increase in potential benefit duration increases the average duration of the unemployment spells of ui recipients by 0 16 to 0 20 weeks

to search or not to search the effects of ui benefit extension for the older unemployed abstract in finland the older unemployed can collect unemployment insurance benefits until retirement while the entitlement period for younger groups is two years in 1997 the eligibility age of persons benefiting from extended benefits was raised from 53 to 55 this paper takes advantage of this quasi experimental setting to identify the effect of extended benefits on transitions out of unemployment among the older unemployed we apply a competing risks version of a split population duration model to account for multiple exit routes and the possibility that some of the older unemployed may not be active in the labour market due to pension rules our finding is that roughly half of the unemployed with extended benefits withdraw from job search

the college to work transition during the 1990s evidence from sweden this article analyses the time it takes for swedish college graduates to start a full time job that lasts for 6 months or more the focus is on the transition over time during the period 1991 to 1999 this period covers both upturns and downturns of the business cycle providing a unique opportunity to consider the importance of the timing of graduation the results show that the risk of unemployment and the unemployment duration have varied considerably with the business cycle both within and between cohorts for example the field of education is of more importance for the outcomes during recessions further the relative risk of unemployment has decreased over time for individuals with the highest degree of education whereas the unemployment duration has increased indicating that the selection into unemployment for this group may have changed over time this is interesting not least in the light of the sharp expansion of the higher educational system during the study period

do benefit cuts boost job finding swedish evidence from the 1990s in june 1995 the swedish parliament decided to cut the replacement rate in unemployment insurance from 80 percent to 75 percent a change that took effect on january 1 1996 this paper examines h

a new approach to decomposition of economic time series into permanent and transitory components with particular attention to measurement of the business cycle abstract this paper introduces a general procedure for decomposition of non stationary time series into a permanent and transitory component allowing both components to be stochastic the permanent component is shown to be a random walk with drift and the transitory or cyclical component is a stationary process with mean zero the decomposition methodology which depends only on past data and therefore is computable in real time is applied to the problem of measuring and dating business cycles in the portwar u s economy we find that measured expansions and contractions are of roughly equivalent duration and that our dating of cyclical episodes tends to lead the traditional nber dating and to a lesser extent the growth cycle chronology of zarnowitz and boschan 1977

the rise of unemployment in france whereas the french unemployment rate had remained less than 2 per cent throughout the postwar years up to 1967 it has since increased having been pushed by an irresistible trend to 2 7 per cent in 1972 4 1 per cent in 1975 5 2 per cent in 1978 7 3 per cent in 1981 and 9 7 per cent in 1984 annual averages ilo definitions the size of the labour force had hardly increased before 1962 during the past 20 years its growth has been slowly accelerating but has remained moderate 0 8 per cent per annum between 1975 and 1982 on the other hand employment increased steadily from 1962 up to the first oil shock but has been roughly constant since then see figure 1 my survey of the analysis of these features and of their explanation will follow traditional lines it will first consider the evolution of the labour force as well as changes in the volume structure and nature of the supply of labour the second section dealing with the demand for labour will pay particular attention to changes in the economic and institutional environment of firms section iii will examine what can be said about a possible increase in frictional

the electoral consequences of the washington consensus this paper assesses how electoral outcomes in both presidential and legislative elections in latin america have been affected by the adoption of economic policies that seek to improve macroeconomic stability and facilitate the functioning of markets the database includes 17 latin american countries for the period 1985 2002 and a total of 66 presidential and 81 legislative elections the set of testable hypotheses is derived from a review of the literature and is structured around the hypothesis of economic voting it is found that i the incumbent s party is rewarded for reductions in the rate of inflation and to a lesser extent for increases in the rate of growth ii the more fragmented or ideologically polarized the party system the higher the electoral rewards of reducing the inflation rate or raising the economic growth rate iii voters care not only about economic outcomes but also about some of the policies adopted while the electorate seems blind to macroeconomic policies such as fiscal or exchange rate policies it is averse to pro market policies irrespective of their effects on growth or inflation and iv the electorate is more tolerant of pro market reforms when the incumbent s party has a more market oriented ideology these results suggest that reforming parties have paid a hefty price for the adoption of pro market reforms except when such reforms have been undertaken in conjunction with stabilization policies in high inflation economies

unemployment duration unemployment benefits and labor market programs in sweden abstract standard search theory as well as some empirical evidence suggest that an unemployed individual s probability of entering employment increases as he approaches the time when unemployment benefits are due to expire this pattern may not carry over to a country like sweden where labor market programs are targeted at the long term unemployed at risk of benefit exhaustion the paper examines transitions out of unemployment using data on unemployed individuals in sweden a semi parametric competing risks model for transitions to employment labor market programs and non participation is estimated there is some evidence that the exit rate from unemployment to employment increases as benefit exhaustion is approached

thailand s low carbon scenario 2050 the aim cge analyses of co2 mitigation measures climate change and co2 mitigation have become increasingly important environmental issues recently thailand has proposed policies on ghg mitigation such as thailand s nationally appropriate mitigation action nama which aims at ghg mitigation in the energy sector this study used the computable general equilibrium cge model called aim cge model to analyse ghg mitigation measures under emission trading and carbon capture and storage ccs technology in thailand results show that the international free emission trading policy can drive more ghg reduction by decreasing energy supply and demand and increasing prices of emissions the ccs technologies would balance emission reduction but they would reduce energy efficiency improvement and renewable energy utilization in the energy security aspect the policy options in this study would improve energy security energy import dependency and co benefits of ghg mitigation in forms of improving local air quality results are also helpful to ghg mitigation policy in developing countries

duration dependence versus unobserved heterogeneity in treatment effects swedish labor market training and the transition rate to employment summary the effect of a treatment on the hazard rate of a duration outcome may depend on the elapsed time since treatment in addition treatment effects may be heterogeneous across agents the former gives rise to duration dependence of the treatment effect whereas unobserved heterogeneity gives rise to spurious duration dependence of the observable hazard rate we develop a model allowing for duration dependence and unobserved heterogeneity in the treatment effect the model incorporates a timing of events model and allows for selectivity on unobservables we prove identification exploiting variation in the timing of treatment and outcome in the application we analyze the effects of the swedish vocational employment training program on the individual transition rate from unemployment to work we demonstrate the appropriateness of the approach by studying the enrollment process the data cover the population and include multiple unemployment spells for many individuals the results indicate a large significantly positive effect on exit to work shortly after exiting the program the effect at the individual level diminishes after some weeks when taking account of the time spent in the program the effect on the mean unemployment duration is small copyright 2012 john wiley sons ltd

living in unemployment or who experiences a high unemployment burden the paper examines the distribution of unemployment experience in britain within the framework of the han and hausman semi parametric estimator which has the advantage of circumventing problems associated with individual heterogeneity arising from unobserved individual characteristics the results imply that the unemployment burden is unequally distributed among the working population males and females bear an unequal unemployment burden the study casts light on the characteristics of those individuals who are most likely to experience a high unemployment burden

the stochastic analysis of competitive unemployment insurance premiums abstract in this paper we investigate the fair pricing of unemployment insurance policies in a stochastic environment this will depend on the idiosyncratic risks confronting individual workers and on the risks facing the risk class as a whole using an arbitrage pricing argument we show that idiosyncratic risks can be diversified away leaving only market risk to be priced

unemployment in britain male unemployment in britain has risen from around 2 per cent in the 1950s to around 17 per cent in 1985 see figure 1 the figures are for male unemployment because there is no consistent series for women 1 even more remarkably unemployment has fallen in only three years out of the last twenty 1973 1978 and 1979 to account for this we need a model that explains both changes in the natural or non accelerating inflation rate of unemployment nairu and deviations from it we use a three equation supply side model centred on the labour market this has two main features the first concerns the determination of employment in the short run the labour demand function that we use cuts through the fruitless debate now raging especially in europe as to whether current unemployment is classical or keynesian according to the classical view employment is too high because real wages are too high according to the keynesian view real wages are not binding and unemployment is high because the product market does not clear with prices too high relative to nominal demand the whole debate is set in the framework of perfect competition yet in perfect competition prices are set by impersonal forces and it is not clear what could possibly stop prices clearing the market it is much more reasonable to think of prices as being set by imperfectly competitive firms existing prices being the best they can think of given the demand they face in this context firms demand for labour will depend on both the real product wage and the level of real aggregate demand this is the demand function we estimate and it conforms both to common sense and to the data however this does not imply that employment can be made to grow without limit by pumping up real demand for in the medium term when price surprises are eliminated our model determines three variables employment real wages and real demand on the basis of three equations an employment equation a price equation and a wage equation thus in the medium term there is a natural level of employment and corresponding to this a natural level of real aggregate demand the second key feature of our model concerns the medium term determination of unemployment in the medium term the planned mark up of wages over prices in wage settlements must be consistent with the mark up of prices over wage costs in employers pricing behaviour for if wage setters try to set real product wages higher than is consistent with employers pricing behaviour this generates ever increasing inflation thus the key to understanding unemployment in the medium term is the behaviour of wage setters if events occur that push them towards too high real wages then unemployment has to rise to offset these influences we shall call these influences wage pressure variables or push factors and they are clearly crucial in understanding unemployment the variables here include the social security system employment protection

labor market effects of unemployment insurance design with the emergence of the great recession unemployment insurance ui is once again at the heart of the policy debate in this paper we review the recent theoretical and empirical evidence on the labor market effects of ui design we also discuss policy issues related to ui design including the structure of benefits the role of liquidity constraints and the pros and cons of a ui system in which the generosity of ui benefits is varying over the business cycle finally we identify potential areas of future research

unemployment insurance job queues and systematic job search an equilibrium approach the labor market effects of unemployment insurance ui have been viewed in several contexts by economists on the one hand the ui system of jobless benefits and experiencerated taxation of firms is seen as influencing firms decisions to lay off workers 9 10 24 2 key in such analyses is the degree to which firms layoffs are subsidized by an imperfect experience rating a tax system in which employers ui taxes increase by less than their workers benefits increase on the other hand many other studies of ui place primary focus on the worker although employer concern for worker well being plays a role even in the work on the impact of ui on firm layoff decisions each of these worker based studies is concerned with one of two issues 1 ui and compensating wage differentials 14 24 or 2 u i and the job search process first hutchens assumes that workers face a choice in the labor market between high wage high layoff probability firms and low wage low layoff probability firms 14 by reducing the cost of being laid off ui increases one s likelihood of choosing the former kind of job along these lines topel finds evidence that ui generosity substitutes for wages and therefore lowers the compensating differential associated with a high layoff job 23 second several authors have studied the effect of ui on job search this work recognizes that ui lowers the cost of searching and therefore raises the reservation wage expected unemployment duration and expected post unemployment wages 2 previous work on the impact of ui on firm layoff decisions has assumed either a layoff subsidy 9 or demand uncertainty 2 in order to generate layoffs and therefore a u i impact on layoffs in contrast to such work this paper views layoffs in an equilibrium context they occur in our model even with no layoff subsidy and or with no demand uncertainty layoffs are of value to the firm in our model since they correspond to workers rejected from a queue of potential trainees from the firm s point of view a queue of applicants may be desirable in order to lower

does unemployment compensation affect unemployment duration abstract we use a flexible hazard rate model with unrestricted spell duration and calendar timeeffects to analyse a dataset including all norwegian unemployment spells during the1990 s the dataset provides a unique access to conditionally independent variation inunemployment compensation we find that a marginal increase in compensation re duces the escape rate from unemployment significantly irrespective of business cycleconditions and spell duration the escape rate rises sharply in the months just prior tobenefit exhaustion while men are more responsive than women with respect to mar ginal changes in compensation women are most responsive with respect to benefitexhaustion keywords unemployment spells business cycles unemployment compensation non parametric duration analysis jel classification c41 j64 the ragnar frisch centre for economic research oslo we wish to thank the re search council of norway for financial support and christian brinck harald goldstein costas meghir espen moen steinar strom rolf aaberge and three anonomyous referees for helpful comments cor respondence to knut roed the ragnar frisch centre for economic research gaustadalleen 21 0349oslo norway e mail knut roed frisch uio no

the swedish unemployment experience by international standards unemployment in sweden remained remarkably low throughout the 1970s and the 1980s in the early 1990s however the unemployment rate increased sharply and hit double digit levels the paper argues that the steep rise in unemployment was mainly the result of a series of adverse macroeconomic shocks partly self inflicted by bad policies and partly caused by unfavourable international developments the extremely contractionary monetary policy in 1992 appears to have had strong and long lasting effects on unemployment institutional factors do not appear as convincing explanations of the steep rise in unemployment in the early 1990s

an empirical examination of the sources of changes over time in the job finding rate using reservation wages and rejected wage offers we consider a structural dynamic job search model where nonstationarity originates from the change over time in the benefit level the job offer arrival rate and the wage offer distribution the model is estimated on the french sample of the echp taking advantage of direct observation of reservation wages rejected job offers and associated rejected wages we find that the offered wages deteriorate rapidly 13 8 over six months 19 2 over one year and 30 over two years and that changes in the wage offer distribution are the unique source of negative duration dependence in the hazard

ecological deficit tax a tax design and simulation of compensation for ecosystem service value based on ecological footprint in china abstract the expansion of resource tax to the occupation of natural ecological space is an important part of china s tax reform this paper quantifies the occupation of natural ecological space based on the demand for energy water and agriculture resources in terms of an ecological footprint and creatively convert the carbon emissions from energy consumption to occupation of carbon sinks such as woodlands and grasslands to obtain the ecological deficits in various regions of china based on the evaluation of the ecological service value the paper determines the correspondence between consumption projects land types and ecological functions realized the accounting of the economic value of the national ecological deficit as the sum of the regional deficits based on this the ecological deficit is used as an unpaid input factor in the construction of a green social accounting matrix table and a recursive dynamic computable general equilibrium model is used to analyze the effects of a tax policy on the compensation for the ecological deficit value the simulation results show that the double dividend hypothesis exists in the primary and tertiary industries and employment in the secondary industry that with a high value added labor decreased resulting in decreases in both the labor income of residents and their proportion of the national income the growth rate of gdp decreases in the short term and then gradually increases capital appreciation and net exports contribute greatly to economic growth based on the positive role of taxation schemes in reducing ecological deficits and their negative impacts on economic growth and the income distribution this paper suggests that with the improvement of big data on ecological occupation an ecological deficit tax can be introduced to target the energy sector which has a large ecological footprint in addition household income should be protected through tax cuts transfer payments and earmarked funds among other means to promote economic growth and protect the environment

unemployment benefit duration and incentives in britain how robust is the evidence abstract recent years have seen considerable advances in the econometric treatment of micro data in models of unemployment duration this paper examines the evidence from such models concerning the effects of unemployment benefits on incentives to work in britain widely accepted results of a small but significant benefit effect are reproduced using a sample of 1 231 unemployed men however these results are only found when benefit receipt is assumed to follow a hypothetical pattern which is shown to be unrealistic and over generous when more realistic calculations of benefits are used no benefit effect is found the paper also argues that search theory is of little help in determining the choice between competing functional forms and explanatory variables results concerning benefits are shown to be sensitive to the latter

unemployment insurance in welfare states the impacts of soft duration constraints based on a major reform of norwegian unemployment insurance ui we examine the behavioral impacts of soft and hard ui duration constraints a constraint is interpreted as hard if a claimant cannot rely on any form of income support after exhaustion and as soft if ui is replaced by follow on benefits or participation in active labor market programs almp we find that both hard and soft constraints raise the job hazard significantly with surprisingly similar spikes at ui exhaustion participation in almp raises the probability of eventually finding a job but at the cost of lengthening the overall job search period

unemployment duration and competing risks evidence from sweden the determinants of unemployment duration are studied in the presence of multiple exits out of unemployment the results indicate that state aggregation may be a severe problem in empirical analysis of a labor market such as the one in sweden estimating a joint model for all transitions out of unemployment leads to biased estimates since different transitions are governed by different mechanisms the results also indicate positive duration dependence in both transitions to regular employment and transitions out of the labor force but no duration dependence in transitions to public labor market programs i introduction during the last decade we have witnessed a rapidly expanding literature on the determinants of unemployment duration the main motivation for this development is that a large share of the increasing unemployment rates in most western economies since the mid 1970s may be attributed to increased unemployment duration see e g the survey by lofgren and engstrom 1988 most empirical studies formulate an estimating equation for the determinants of the outflow from unemployment in terms of the hazard function which describes the conditional probability of leaving unemployment these studies are typically based on an explicit or implicit assumption that the only relevant transition out of unemployment is reemployment in this paper it is argued that such an assumption which amounts to assuming that all transitions from unemployment are governed by the same mechanism may lead to state aggregation bias we have no a priori reason to believe that e g increased education has the same effect on transitions from unemployment to employment as on transitions from

income dynamics in argentina during the 1990 s mobiles did change over time in this paper we seek to determine the principal observed socioeconomic factors correlated with household income dynamics in argentina during the nineties in other words we want to identify who got ahead who fell behind and who kept up economic position in argentina in order to determine if they were always the same type of individuals households or if on the contrary their characteristics changed during the distressing 1990 s such analysis is relevant since the rises and falls in income or consumption experienced by households are the most direct indicators available of who benefits how much from economic development although there is a vast literature on income distribution analysis from a cross sectional perspective studies offering insights into the dynamics of income or more generally of economic well being and the factors associated with it are still on the research agenda for many countries such work has been particularly delayed in developing countries chiefly because of a lack of panel data surveys which have only recently begun to be carried out in a more systematic way 4 moreover and again due to data restraints even less is known about the possible changes in the dynamics of income over time if mobility analysis requires at least two observations over time from the same household or

search behaviour transitions to non participation and the duration of unemployment using longitudinal micro data on unemployed individuals for 1983 85 a structural job search model is estimated the model allows for transitions from unemployment to nonparticipation an extended version of the model deals with the influence of on the job search and prospective wage increases on search behavior of the unemployed the empirical results show that the probability of accepting a job offer is almost one for most unemployed individuals a large portion of unemployment spells ends in a transition out of the labor force the effects of changes in benefits on duration appear to be extremely small copyright 1990 by royal economic society

the inequality of unemployment experience in a local labour market this study applies a recently developed methodology in order to estimate the extent of the inequality of unemployment experience in aberdeen the findings show that the unemployment burden is indeed unequally shared and that this inequality exhibits only a limited decrease through time

why do global long term scenarios for agriculture differ an overview of the agmip global economic model intercomparison recent studies assessing plausible futures for agricultural markets and global food security have had contradictory outcomes to advance our understanding of the sources of the differences 10 global economic models that produce long term scenarios were asked to compare a reference scenario with alternate socioeconomic climate change and bioenergy scenarios using a common set of key drivers several key conclusions emerge from this exercise first for a comparison of scenario results to be meaningful a careful analysis of the interpretation of the relevant model variables is essential for instance the use of real world commodity prices differs widely across models and comparing the prices without accounting for their different meanings can lead to misleading results second results suggest that once some key assumptions are harmonized the variability in general trends across models declines but remains important for example given the common assumptions of the reference scenario models show average annual rates of changes of real global producer prices for agricultural products on average ranging between 0 4 and 0 7 between the 2005 base year and 2050 this compares to an average decline of real agricultural prices of 4 p a between the 1960s and the 2000s several other common trends are shown for example relating to key global growth areas for agricultural production and consumption third differences in basic model parameters such as income and price elasticities sometimes hidden in the way market behavior is modeled result in significant differences in the details fourth the analysis shows that agro economic modelers aiming to inform the agricultural and development policy debate require better data and analysis on both economic behavior and biophysical drivers more interdisciplinary modeling efforts are required to cross fertilize analyses at different scales

how does the benefit effect vary as unemployment spells lengthen summary this paper investigates how the effect of income while unemployed on the probability of an individual leaving unemployment varies with the length of time that the individual has been unemployed we examine this question in the context of a variety of alternative econometric models we extend the proportional hazards model with unrestricted baseline hazard to one in which there are unrestricted effects of a subset of the explanatory variables and also consider models that can be estimated as series of binary response models the proportional hazard restrictions are rejected for the sample of british unemployed men analysed and in the binary sequence framework logit and probit models based on symmetric distributions dominate in likelihood terms the extreme value form model implied by extension of the proportional hazards formulation logit models with a flexible form for the duration dependence which also incorporate unobserved heterogeneity in a flexible way are estimated the results for all formulations indicate a rapidly declining effect of unemployment income as a spell lengthens with no significant effect for the long term unemployed the preferred specifications which allow for omitted heterogeneity indicate no significant effect after about 5 months and this result is robust to the inclusion or exclusion of previous labour market experience variables and to the choice of mixing distribution

assessing the impacts of china s environmental tax using a dynamic computable general equilibrium model abstract since 2018 china has put into practice the new environmental protection tax law which levies taxes on non greenhouse pollutants with stringent standards to fully study the socioeconomic and environmental impacts of this policy this paper establishes a dynamic country level compute general equilibrium cge model with the electricity sector disaggregated into 5 technologies and 19 major taxable pollutants included five scenarios are developed including the baseline scenario bau the low environmental tax scenario lowet the high environmental tax scenario highet the low environmental tax and low carbon tax scenario lowetc and the high environmental tax and high carbon tax scenario highetc the simulation results show that the environmental tax could help reduce emissions of most kinds of pollutants but bring negative effects on the gross domestic product gdp compared to the bau scenario the gdp loss by 2030 would be 0 10 0 21 0 32 and 0 67 in the lowet highet lowetc and highetc scenarios the emission of sulphur dioxide so2 will decrease by 3 55 7 15 6 70 and 13 01 and the emission of carbon dioxide co2 will be reduced by 2 21 4 62 8 91 and 16 77 the result also shows that the heavy polluted sectors and energy intensive sectors will suffer higher output loss while the clean energy sectors and service sector will experience an increase in the output in the policy scenarios

benefit duration unemployment duration and job match quality a regression discontinuity approach summary we use a sharp discontinuity in the maximum duration of benefit entitlement to identify the effect of extended benefit duration on unemployment duration and post unemployment outcomes employment stability and re employment wages we address dynamic selection which may arise even under an initially random assignment to treatment estimating a bivariate discrete time hazard model jointly with a wage equation and correlated unobservables owing to the non stationarity of job search behavior we find heterogeneous effects of extended benefit duration on the re employment hazard and on job match quality our results suggest that the unemployed who find a job close to and after benefit exhaustion experience less stable employment patterns and receive lower re employment wages compared to their counterparts who receive extended benefits and exit unemployment in the same period these results are found to be significant for men but not for women copyright 2012 john wiley sons ltd

search benefits and entitlement in a simultaneous analysis of unemployment duration and search intensity we estimate a non structural search model accounting explicitly for two features of the benefit system benefit level and time remaining until exhaustion of the entitlement period residual entitlement special attention is paid to the number of search contacts as an indicator for search intensity to assess the effect of the benefit level and residual entitlement on the number of search contacts we estimate a poisson model our results suggest that benefits work through a reduction of search efforts whereas residual entitlement is effective mainly through the reservation wage

application of computable general equilibrium cge to climate change mitigation policy a systematic review abstract with the growing literature related to climate change mitigation measures and policy interventions a systematic review of the application of computable general equilibrium cge model is inevitable therefore this article aims to characterise the relevant studies define a comparative framework to identify the current state of the art and the gaps in applied general equilibrium models firstly the systematic review found a total of 301 research articles from scopus and web of science databases and finally analysed 154 articles based on inclusion and exclusion criteria from 67 refereed journals the review analysis found that application of cge model is very vital in addressing climate change mitigation issues at the national regional and global levels however china attracted the most substantial research interests followed by the usa india and australia among others which are in line with their share of greenhouse gas emissions in the world most of the research themes focus on the carbon tax emission reduction target emission trading renewable energy energy efficiency and carbon capture and storage as primary drivers of low carbon economy nevertheless there is a trend of employing more static cge model compared to the dynamic cge although application of the latter has a limitation of providing right inputs to the macroeconomic policy finally research directions and gaps envision other complementary models such as dynamic stochastic general equilibrium dsge and agent based model abm for proper policy interventions

an evaluation of the swedish system of active labour market programmes in the 1990s we investigate the presence of short and long term effects from joining a swedish labor market program vis a vis more intense job search in open unemployment overall the impact of the program system is found to have been mixed joining a program has increased employment rates among participants a result robust to a misclassification problem in the data on the other hand it has also allowed participants to remain significantly longer on unemployment benefits and more generally in the unemployment system this being particularly the case for those entitled individuals entering a program around the time of their unemployment benefits exhaustion

an empirical analysis of the unemployment duration of school leavers unemployment is a waste of vaulable human resources which also imposes various economics medical and psychological costs on the individual these costs are likely to be greater the longer the duration of umemployment this is true for both prime aged workers and the youngest entrants to the labour market that is school leavers using careers service data on 1979 1980 and 1981 leavers the authors seek to shed light on the issue of what factors determine the duration of unemployment for minimum aged school leavers the way in which these factors can be used by the careers service to identify those school leavers who have a higher risk of long term unemployment is discussed and a number of strategies for helping this group are outlined the results show that after allowing for the distorting influence of the youth opportunities programme longer durations of unemployment are associated with an absence of work experience low to intermediate qualifications and other personality traits

searching for a will o the wisp an empirical study of the nairu in canada abstract this paper demonstrates the uncertainty surrounding estimates of the non accelerating inflation rate of unemployment nairu a reduced form phillips curve is used to develop a generic model of the nairu which nests competing hypotheses about the specific form of the inflation unemployment relationship empirical results for the canadian economy show that the range of prime age male nairu s generated by statistically satisfactory and economically reasonable estimating equations covers almost the entire range of canadian post war prime age male unemployment experience estimates of the nairu depend heavily on the form of the estimating equation the operational definition of key variables and the data sample period

how changes in financial incentives affect the duration of unemployment this paper studies how changes in the two key parameters of unemployment insurance the benefit replacement rate rr and the potential benefit duration pbd affect the duration of unemployment to identify such an effect we exploit a policy change introduced in 1989 by the austrian government which affected various unemployed workers differently a first group experienced an increase in rr a second group experienced an extension of pbd a third group experienced both a higher rr and a longer pbd and a fourth group experienced no change in the policy parameters we find that unemployed workers react to the disincentives by an increase in unemployment duration and our empirical results are consistent with the predictions of job search theory we use our parameter estimates to split up the total costs to unemployment insurance funds into costs due to changes in the unemployment insurance system with unchanged behaviour and costs due to behavioural responses of unemployed workers our results indicate that costs due to behavioural responses are substantial

reservation wage analysis of unemployed youths in australia this paper focuses on the analysis and structural estimation of the reservation wage function from a job search model using modified 2sls and maximum likelihood procedures with selectivity bias adj

unemployment insurance in theory and practice a hallmark of modern labor economics is the close interplay between the development of theory data sources and econometric testing the evolution of the economic analysis of unemployment insurance provides a good illustration new theoretical approaches in particular job search theory have inspired a large amount of empirical research some of it methodologically innovative and most of it highly relevant for economic policy the paper presents a broad survey and an assessment of the economic analysis of unemployment insurance as it has evolved since the 1970s

unemployment durations and local labour market conditions abstractunemployment durations vary across local authority districts in the uk we explore the extent to which this variation is explained by differences in local labour demand as opposed to compos

unemployment duration and economic incentives a quasi random assignment approach abstract we investigate how economic incentives and spell duration affect hazard rates out of insured unemployment we take into account that insured unemployment not always ends in employment but also in disability training programs or benefit sanctions our empirical basis is norwegian register data containing variation in economic incentives and spell duration similar to that of random assignment experiments we find that the employment and benefit sanction hazards are negatively affected by the unemployment insurance replacement ratio but that the effects vary considerably among individuals there is negative duration dependence in the employment hazard and positive duration dependence in the disability hazard

competition between employed and unemployed job applicants swedish evidence we use the swedish applicant database to investigate empirically whether being unemployed per se reduces the probability of getting contacted by a firm all searchers looking for a new job are invited to submit their personal details to this database over the internet since we have access to exactly the same information as the firms we can minimize the problems associated with unobserved heterogeneity our results show that an unemployed applicant faces a lower contact probability than an otherwise identical employed applicant thus supporting the notion that firms view employment status as a signal of productivity

why do women have longer durations of unemployment than men in post restructuring urban china this paper provides the first systematic analysis of the reasons why women endure longer unemployment durations than men in post restructuring urban china this analysis is based upon data obtained from a national representative household survey rejecting the view that women are less earnest than men in their desire for re employment this analysis shows that women s job search efforts are handicapped by a lack of access to social networks unequal entitlement to social re employment services higher earnings losses from job separations for women and unfair treatment of women with respect to mandatory retirement

testing for a santa claus effect in growth cycles abstract we examine the seasonal distribution of turning points in the post war growth cycles of sixteen economies using nonparametric tests for distributions on the circle we cannot reject a uniform distribution for the turning points for most of the countries in the case of troughs uniformity is supported for eleven countries notwithstanding the unusually large number of december or january troughs this provides evidence against a santa claus effect in the growth cycle

sick of being unemployed interactions between unemployment and sickness insurance this paper examines the incentive effects of interactions between unemployment insurance ui and sickness insurance si two important components of sweden s social insurance system the main topic is how the sickness report rate among the unemployed is affected by i the limit of 300 workdays for ui benefits and ii the difference in maximum compensation between ui and si benefits results obtained by duration analysis suggest that sick reports increase as the ui benefit expiration date approaches there is also evidence of an incentive effect on the sick report rate because si offers higher compensation than ui

in search of complementary assets the determinants of alliance formation of high tech start ups abstract why do new technology based firms ntbfs cooperate starting from teece s teece d j 1986 profiting from technological innovation implications for integration collaboration licensing and public policy research policy 15 285 305 conceptual framework and taking advantage of subsequent literature on alliance formation in the resource and competence based tradition and in the social structure perspective we derive an empirical model that aims at highlighting the inducements and obstacles that these firms face in alliance formation according to firm specific characteristics and the nature of the alliance in particular a distinction is made between exploitative commercial alliances and explorative technological alliances the econometric estimates based on a large sample of italian young high tech firms that are observed from 1994 to 2003 provide strong evidence supporting two key intuitions of teece s work first the combination of specialized complementary assets appears to be a key driver of the formation of exploitative commercial alliances by ntbfs more specifically patent holding affects positively the likelihood to establish commercial alliances but this propensity is found to rapidly decrease with firm size suggesting that as long as ntbfs become larger and possess specialized commercial assets their urge for commercial alliances diminishes second following the parallelism set forth by teece between search for alliance partners and access to external financing the analysis indicates that potentially beneficial alliances may not take place because of the high transaction costs faced by smaller ntbfs in this respect our results clearly support the view that sponsor institutions as public research organizations venture and corporate venture capitalists may sensibly reduce these costs and that their role crucially depends on both the identity of the sponsor and the type of alliance

differentiating between business cycles and growth cycles evidence from 15 developed countries growth cycles are often mistaken for business cycles although these two have different statistical properties in order to differentiate between them in a statistically satisfactory manner the bayesian information criterion bic based model selection approach is presented business cycles are described by the cyclical trend model and growth cycles are described by the trend plus cycle model whether the observed time series is derived from business cycles or from growth cycles is determined as a result of model selection it is shown via data based simulations that the proposed method works well in most situations empirical results obtained for 15 countries suggest that the business cycle model is selected for five countries the growth cycle model is selected for two countries and the trend plus noise model is selected for eight countries

unemployment insurance and unemployment spells this paper tests the effects of the level and length of unemployment insurance benefits on unemployment durations the paper particularly studies individual behavior during the weeks just prior to when benefits lapse higher unemployment insurance benefits are found to have a strong negative effect on the probability of leaving unemployment however the probability of leaving unemployment rises dramatically just prior to when benefits lapse individual data are used with accurate information of spell durations and the level and length of benefits the semiparametric estimation techniques used in the paper yield more plausible estimates than conventional approaches and provide useful diagnostics copyright 1990 by the econometric society

the effects of labour market policies in an economy with an informal sector in this article we build an equilibrium search and matching model of an economy with an informal sector our model extends mortensen and pissarides 1994 by allowing for ex ante worker heterogeneity with respect to formal sector productivity we use the model to analyse the effects of labour market policy on informal sector and formal sector output on the division of the workforce into unemployment informal sector employment and formal sector employment and on wages finally we examine the distributional implications of labour market policy specifically we analyse how labour market policy affects the distributions of wages and productivities across formal sector matches in this article we construct a search and matching model that we use to analyse the effects of labour market policies in an economy with a significant informal sector what we mean by an informal sector is a sector that is unregulated and hence not directly affected by labour market policies such as severance or payroll taxes we find that labour market policies that apply only to the formal sector nonetheless affect the size and the composition of employment in the informal sector this is important since there is substantial economic activity in the informal sector in many economies particularly in developing countries estimates for some latin american countries put the informal sector at more than 50 of the urban work force 1 the informal sector is also important in many transition countries as well as in some developed economies 2 although much of the literature treats the informal sector as a disadvantaged sector in a segmented labour market framework this interpretation is not consistent with recent empirical evidence from latin america under a segmented or dual labour market interpretation one would expect jobs to be rationed in the primary sector and workers to be in the secondary or informal sector involuntarily and to be queuing for formal sector jobs maloney 2004 presents evidence for several latin american countries that challenges this view and instead interprets the informal sector as an unregulated micro entrepreneurial sector similarly using data from the argentinian household survey pratap and quintin 2006 reject the notion that labour markets are segmented in the greater buenos aires area concluding that there is no evidence of a formal sector wage premium after controlling for individual and establishment we thank mauricio santamaria for stimulating conversations that inspired our interest in this topic we also thank bob hussey and fabien postel vinay as well as our editor steve pischke and two anonymous

the determinants of individual unemployment durations in an era of high unemployment this paper presents the results of an econometric analysis of the conditional probability of leaving unemployment for two male inflow cohorts entering unemployment at very different points in time 1978 and 1987 the effect of income while unemployed is found to be much weaker for the i987 cohort an elasticity of o i compared with 0 4 and is only found to be significant for teenagers and in the first three months of a spell demand constraints measured by the local unemployment rate are found to have a stronger negative effect on the exit probability for the i987 cohort than in 1978 the i 980s witnessed continual high levels of unemployment in britain and the movement of unemployment up the economic and political agenda unemployment results in major output and income losses and is the cause of much misery to those involved the nation is poorer because of it for both reasons it is therefore important to understand the process that generates a given level of unemployment this process can be considered in terms of two key probabilities the probability of an individual entering unemployment and the probability of an unemployed individual leaving unemployment to take up a job or for other reasons these probabilities will vary with the characteristics of the individual concerned and over time changes in the aggregate unemployment rate can under certain assumptions be decomposed into changes in the inflow rate into unemployment and changes in the steady

effects of manpower policies on duration dependence in re employment rates the example of sweden in contrast to the evidence from other countries swedish studies of the transition from unemployment to employment have consistently reported a non negative duration dependenice in the hazard this study examines the extent to which this results from large scale labour market programmes a limited duration of unemployment benefits or differences among available jobs the labour market programmes are here found to be the primary factor behiind the earlier swedish results the programmes thus pick up those with the worst employment prospects thereby postponing a decrease in the re employment probability among job searchers this in turn generates an on average constant duration dependence

does long term unemployment reduce a person s chance of a job a time series test long term unemployed are less likely to leave unemployment than short term unemployed to what extent is this due to an effect of duration and to what extent to heterogeneity on reasonable assumptions heterogeneity on its own with no duration dependence would imply that if over time the exit rate of new entrants fell by a given multiple the overall exit rate from unemployment should fall by the same multiple however over the last twenty years in the uk the overall exit rate has fallen by 60 per cent more than the fall in the exit rate of new entrants another test of pure heterogeneity based on more general assumptions also fails hence we explain the overall fall in exit rates from unemployment by the combined effect of 1 a fall in the ratio of vacancies to unemployed and 2 a higher proportion of the unemployed being long term unemployed and hence demoralized and stigmatized in the eyes of employers

improving incentives in unemployment insurance a review of recent research abstract this paper provides a review of the recent literature on how incentives in unemployment insurance can be improved we are particularly concerned with three instruments i e the duration of benefit payments or more generally the time sequencing of benefits monitoring in conjunction with sanctions and workfare our reading of the theoretical literature is that the case for imposing a penalty on less active job search is fairly solid a growing number of empirical studies including randomized experiments are in line with this conclusion

the role of selective job search in uk unemployment selective search where unemployed job losers confine their job seeking efforts to matches in the pre separation sector has attracted consid erable attention as a possible source of high and persistent unemployment however this idea is questionable those opting for selection may do so because this strategy is more effective at gener ating an acceptable offer using uk microdata i find evidence in support of the latter view selective searchers cannot account for the persistence of high unemployment since the early 1980s

household unemployment and the labour supply of married women a recent reform to the uk unemployment insurance ui system has reduced the duration of entitlement from 12 to six months the ui and welfare systems interact in the uk in such a way that exhaustion of ut for married individuals has potentially large disincentive effects on the labour supply of spouses a model of labour supply is estimated for married women allowing for endogenous unemployment durations of husbands and wives we distinguish between transfer programme induced incentive effects correlation between labour supply and wages within couples complementarity between the leisure times of spouses and a discouraged worker effect

temporary disability insurance and labor supply evidence from a natural experiment most developed countries have compulsory insurance programs for temporary disability that is cash benefits for non work related sickness despite the economic significance of these programs little is known about their effects on work absenteeism or labor supply we exploit a policy reform that consisted of the abolishment of a waiting day together with an increase of cash benefits for short sick leaves we find that the total number of days of sickness absence was reduced by the reform which is likely due to the fact that the abolishment of the waiting period made it less costly for workers to be absent for short periods

reconstructing the pattern of american unemployment before the first world war this paper calculates the distribution of unemployment duration lengths and transition rates for massachusetts workers in the late nineteenth century using data on time spent out of work and assuming that the spell durations followed a weibull distribution i parameterize a model of the timing of transitions from unemployment to employment and vice versa i then simulate the employment experience of representative workers and construct distributionis of completed spell lengths the experience of most out of work workers in a year seems to have been in one rather long spell rather than in shorter multiple ones

how shortening the potential duration of unemployment benefits affects the duration of unemployment evidence from a natural experiment in this article we investigate the disincentive effects of shortening the potential duration of unemployment insurance ui benefits we identify these disincentive effects by exploiting changes in slovenia s unemployment insurance system a natural experiment that involved substantial reductions in the potential duration of benefits for four groups of workers plus no change in benefits for another group which served as a natural control we find that the change had a positive effect on the exit rate from unemployment to new jobs and other options for unemployment spells of various lengths and for several categories of unemployed workers

dormancy risk and expected profits of consumer loans abstract a bank that lends money to a household faces two types of risk frequently mentioned is the risk of default seldom referred to is the risk of an early redemption of the loan leading to dormancy in this paper we model the transition of consumer loans from an active to a dormant state to this end we use data on 4786 individuals who were granted credit by a swedish lending institution between september 1993 and august 1995 and estimate a semi parametric duration model we analyze the factors that determine the time to maturity on consumer loans and investigate the ability of the model to match the maturities observed in the data moreover we derive the distribution of conditional expected durations of loans and show how a loan application can be evaluated by calculating its expected profit