IZA DP No. 414: Where Did They Go?
published in: Labour Economics, 2007, 14 (5), 811-828
We study individual job-separations and their associated destination states for all individuals in the private sector in Denmark for the period 1980 to 1995 and account for the cyclical flows. We find that individual and workplace characteristics as well as business cycle effects are important in explaining the individual behaviour. In policy simulations we look at the impact on individual transitions. We find that structural and growth policies have different implications for the economy. Policy interventions with the purpose of preventing firm closures are argued to be inefficient.