• Media type: Report; E-Book
  • Title: Analysing plant closure effects using time-varying mixture-of-experts Markov chain clustering
  • Contributor: Frühwirth-Schnatter, Sylvia [Author]; Pittner, Stefan [Author]; Weber, Andrea [Author]; Winter-Ebmer, Rudolf [Author]
  • Published: Linz: Johannes Kepler University of Linz, Department of Economics, 2016
  • Language: English
  • Keywords: Inhomogeneous Markov chains ; Multinomial Logit ; Transition data ; Markov Chain Monte Carlo ; Panel data
  • Origination:
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  • Description: In this paper, we study data on discrete labor market transitions from Austria. In particular, we follow the careers of workers who experience a job displacement due to plant closure and observe - over a period of forty quarters - whether these workers manage to return to a steady career path. To analyse these discrete-valued panel data, we develop and apply a new method of Bayesian Markov chain clustering analysis based on inhomogeneous first order Markov transition processes with time-varying transition matrices. In addition, a mixture-of-experts approach allows us to model the prior probability to belong to a certain cluster in dependence of a set of covariates via a multinomial logit model. Our cluster analysis identifies five career patterns after plant closure and reveals that some workers cope quite easily with a job loss whereas others suffer large losses over extended periods of time.
  • Access State: Open Access