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Analysis of data from the Displaced Worker Survey 1988 showed that (1) longer written notice more than doubled the proportion of white-collar workers who move directly to new employment; (2) informal notice improves male white-collar workers' chances of avoiding unemployment and reduces male blue-collar workers' average spell of unemployment. (SK)

Using data from the 1984 Displaced Worker Survey, the authors model determinants of time without work for a sample of workers laid off because of plant shutdowns. They focus on the role of advance notification. Advance notification significantly reduced duration of unemployment of workers who did not draw unemployment benefits. (Author/CH)

The Worker Adjustment and Retraining Notification Act (WARN) of 1988 requires that covered firms provide affected employees with 60 days' advance notice of plant closings and large-scale layoffs. The authors use data from the three most recent Displaced Worker Surveys to compare the extent of notice under voluntary (1983-88) and mandatory (1989-91) notice regimes. They find that the legislation has had at most a small impact on the provision of notice of the length stipulated under the Act. This non- event is at least partially due to the liberal firm-size and layoff thresholds for determining coverage under WARN. [ABSTRACT FROM AUTHOR]

A thorny problem in identifying the determinants of reservation wages and particularly the role of continued joblessness in their evolution is the simultaneity issue. We deploy a control function approach to the problem that involves conditioning elapsed duration on completed unemployment duration in the reservation wage equation. Our analysis confirms that the use of elapsed duration alone compounds two separate and opposing influences. Only with the inclusion of completed duration is the negative effect of continued joblessness on reservation wages apparent. [ABSTRACT FROM AUTHOR]

Recent US microeconomic analysis indicates that good industrial relations might improve firm performance. Of late, it has also been claimed that the benefits of industrial relations quality – proxied inversely by a strikes variable – could also extend to the macroeconomy. Using cross-country data, we find that, independent of other labor market institutions, a lower strike volume is associated with lower unemployment. Although there is a separate line of causation running from unemployment to strikes, our analysis suggests that this is not dominant. That said, support for the notion that macro performance owes something to good industrial relations is, however, weakened once we formally control for strike endogeneity. [ABSTRACT FROM AUTHOR]

This paper uses a unique Portuguese dataset to examine the effect of access to unemployment benefits (UBs) and their maximum potential duration on escape rates from unemployment. In examining the time profile of transitions out of unemployment, the principal contributions of the paper are twofold. First, it provides a detailed state space of potential outcomes: open-ended employment, fixed-term contracts, part-time work, government-provided jobs, self employment, and labour force withdrawal. Second, it is able to exploit major exogenous discontinuities in the maximum duration of unemployment benefits to identify disincentive effects. While confirming strong disincentive effects, it is shown that use of an aggregate hazard function regression model compounds very different and even contradictory effects of the determinants of unemployment. [ABSTRACT FROM AUTHOR]

Alternative work arrangements (AWAs), such as contracting, consulting, and temporary work, have been criticized as providing only atypical, even precarious, employment. Yet they may also allow workers to locate suitable job matches. Exploiting data from four Contingent and Alternative Employment Arrangement Supplements to the Current Population Survey, we investigate the initial job-finding strategies pursued by the unemployed. Within the narrow window offered by the data, we find that unemployed workers who become reemployed are more likely to find work in AWAs than in regular, open-ended employment. When we evaluate the use of AWAs against unemployment, there is also evidence that the jobless are entering AWAs as pathways out of their initial labor market state. [ABSTRACT FROM AUTHOR]

This paper examines the determinants of unemployment duration in a competing risks framework with two destination states: inactivity and employment. The innovation is the recognition of defective risks. A polynomial hazard function is used to differentiate between two possible sources of infinite durations. The first is produced by a random process of unlucky draws, the second by workers rejecting a destination state. The evidence favors the mover-stayer model over the search model. Refinement of the former approach, using a more flexible baseline hazard function, produces a robust and more convincing explanation for positive and zero transition rates out of unemployment. [ABSTRACT FROM AUTHOR]

Empirical investigation of the labor market consequences of employment protection has mushroomed since Lazear's (1990) pioneering study. Having sketched the theoretical background, we chart the course of the modern empirical literature. We focus mainly on dismissals protection, distinguishing between the themes of employment and unemployment development and labor market dynamics proper. Our discussion of employment and unemployment largely deals with the effect of employment protection on levels of these outcome indicators. We distinguish between overall and compositional effects (e.g., by demographic group and type of contract), between developing and industrialized nations, and identify some key control variables. Our discussion of labor market dynamics focuses on the speed of adjustment issue and on gross flows. It also formalizes the Link between analyses of levels of and changes in variables. At all times potential offsets to the adverse effects of employment protection receive consideration. [ABSTRACT FROM AUTHOR]

The article argues using a parametric model with time-varying effects, that the differences between the short-and long-term unemployed may not simply reflect differences in observed characteristics but also the configuration of baseline hazard. The need to reflect some such considerations in an applied model given the theoretical ambiguities alluded to earlier and the perceived scale of the "problem," as indexed by the ever larger funding for measures directed toward the long-term unemployed, motivates the present treatment. But analysis of the behavior of the long-term unemployed must be undertaken in conjunction with that of the short-term unemployed. This requirement appears to have been neglected in the past, thereby giving rise to problems of endogenous stratification. The methodology must therefore pursue what is undoubtedly an important distinction in behavior while using data on the full sample of unemployed. A broad spectrum of specification problems confront the analyst in the attempt to model unemployment duration.

This paper seeks to establish what we do, and do not, know about the consequences of advance notification and to identify the sources of opposition to the proposed legislation. To this end, the current bill is first discussed against the backdrop of earlier federal (and state) initiatives in this area. A review of the extent of notice in individual and collectively bargained contracts precedes discussion of the cases for and against notifying workers of their impending displacement. An examination of the extant literature charting the effects of advance notification on unemployment and earnings follows. It is concluded on the basis of these theoretical and empirical arguments that a case can be made for the experimental adoption of legislation. That said, the next task is to explain the intensity of employer opposition. This emerges as having less to do with the legislation itself than with a major reform agenda also before Congress that seeks to mandate an altogether wider array of employee benefits than prenotification. [ABSTRACT FROM AUTHOR]

This article presents a study on job security in the U.S. A spate of plant closings during the recent recession added to growing fears of deindustialization and stimulated considerable discussion of the job security question. The broad perception is that the appropriate locus for decisions on job security and job rights is that of the exchange process of the individual or collective bargain. The major assistance available to displaced workers is that offered by the unemployment insurance system. In a fundamental sense, displaced workers have made the decision that they do not wish to purchase job security either initially or at the point of displacement.