P 24

Project Leader:
Dr. Marco Caliendo, IZA Bonn
Dr. Arne Uhlendorff, IZA Bonn

Project Assistant:
Ricarda Schmidl, IZA Bonn

In this research project we analyze the transition process from unemployment to employment. Thereby we focus on the determinants of reservation wages and the type and intensity of job search as well as their impact on unemployment duration. Both components depend on factors like education, age, unemployment benefits and household composition. Next to these “classical” variables the process may depend on factors like personality traits or social networks, which are usually unobservable for the econometrician.

In addition to administrative data we base our analysis on unique survey data containing a large inflow sample of unemployed. Individuals are interviewed shortly after entering unemployment and are followed over time for up to three years. This data set allows us to observe individual job search intensity, reservation wages and job offers at different points in time as well as realized transitions into employment. Risk aversion, locus of control and social networks are part of the rich information and will help us to understand the determinants of the transition process from unemployment to employment more deeply. Identifying the underlying key factors will give us valuable information for improving the employment probability of individuals with a high risk of long-term unemployment like low skilled or elderly workers.