The Duration of Youth Unemployment in West Germany: Some Theoretical Considerations

This paper presents a theoretical model dealing with the duration of youth unemployment in West Germany.Duration can be expressed in terms of the underlying hazard function.After a brief discussion of a reasonable shape of the hazard function a distinction is made with respect to the probabilities of receiving a job offer and accepting it.Determinants of the latter decision are developed using a unified model of consumption, leisure, and job search.Uncertainty and some restrictions such as standard work time and entitlement to unemployment compensation are taken into account.The probability of receiving a job offer depends, among other factors, on the screening process undertaken by the firms.