Duration Models

In many countries, the rise and persistence of unemployment from the 1970s onwards led to labour economists paying special attention to the duration of a spell of unemployment. The econometric analysis of spell durations is based on methods developed in other disciplines (especially biometrics and the analysis of survival times after surgery or medical treatment). Furthermore, while the focus was initially on unemployment duration, other issues in labour economics can be approached in a similar manner, such as job mobility, strike duration, and time out of the labour force for maternity leave. Essentially, the aim is to determine the factors that influence the length of a spell in a given state, and the likelihood of leaving that state for another. This chapter presents key elements in modelling durations relevant to empirical labour economics.