These findings are in accordance with empirical results. Both models allow for non-proportionality of the effect of the explanatory variables on the hazard function. The two models are applied to Danish unemployment data containing a large fraction of temporary layoffs. The econometric analysis shows that the results from the multiple phase duration model are contaminated by the presence of temporary layoffs. We investigate the effects on the duration of unemployment spells and on the transition rates from unemployment to schooling and employment.
Hospital admission seems to stabilize employment for all diagnoses.
At the time of admission, we match all patients with people from the same cohort and gender. Both groups are then followed for several years before and after time of admission. Second, it improves the correspondence between the theoretical characterization of the endogeneously derived earnings density and the empirically observed earnings density. We subsequently estimate the model on Danish labour market data using a structural non-parametric estimation procedure. We find that the model provides a good characterization of some empirical features of the labour market.