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Savings and Labor-Market Transitions
Richard Blundell, Thierry Magnac and Costas Meghir
Journal of Business & Economic Statistics
Vol. 15, No. 2, Structural Estimation in Applied Microeconomics (Apr., 1997), pp. 153-164
Stable URL: http://www.jstor.org/stable/1392302
Page Count: 12
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A model is developed that allows for a layoff rate and a job-arrival rate in the intertemporal choice of consumption and labor-market state. The identification of such a model is established without recourse to dynamic programming solutions, and the minimum data requirements for estimation are derived. Unobserved heterogeneity is included in the model specification, but state dependence is only allowed through the layoff and arrival rates. These are restricted to be functions of observable weakly exogenous variables.
Journal of Business & Economic Statistics © 1997 American Statistical Association