Journal article

A Study into the Persistence of Living in a Jobless Household

Nicolas Herault, Guyonne Kalb, Rezida Zakirova



Relatively little is known about the dynamics of living in a jobless household at the individual level. We seek to fill this gap by using the Household Income and Labour Dynamics in Australia survey to estimate a dynamic random effects probit model of household joblessness. We find that state dependence clearly is an important factor in the persistence of household joblessness, as are a number of observed characteristics, while unobserved heterogeneity is also shown to play an important role. Interestingly, the results indicate that the degree of state dependence differs very little between individuals with different characteristics.


Funding Acknowledgements

This paper is based on research commissioned by the Australian Government Department of Education, Employment and Workplace Relations (DEEWR) under the Social Policy Research Services Agreement (2005-2009) with the Melbourne Institute of Applied Economic and Social Research. Additional research to complete this paper was funded by the Faculty of Business and Economics at the University of Melbourne. The research commissioned by DEEWR has benefited from comments by DEEWR staff, and we acknowledge the contributions of Kostas Mavromaras and Lucinda Platt to this earlier research (Herault et al., 2010). The paper uses the confidentialised unit record file from the Department of Social Services (DSS) Household, Income and Labour Dynamics in Australia survey, which is managed by the Melbourne Institute of Applied Economic and Social Research. The views expressed in this paper are those of the authors alone and do not represent the views of the Minister for DEEWR, DSS, or the Commonwealth Government. We are grateful to Deborah Cobb-Clark, Daniel Hamermesh and two anonymous referees for helpful comments.